Loan - can I?

Cairn

Hi all,

I’m possibly considering getting a loan of £6k for a new car, but I’ve noticed that loans over £7.5k attract lower interest rates. 

Do you know if it’s possible to borrow say 7.5k over 3 years to secure a low rate, but then pay back £1.5k almost immediately? If I did this, would the monthly rate drop pro rata or stay the same this reducing the loan term? 

Cheers in advance. 

[Deleted User]

Yes you can 

Which of the two scenarios then takes place depends on the lender.

Most common is that the monthly repayment stays the same.

Cairn

Many thanks, so it’s likely that the monthly repayment would stay the same but the term reduce? Hmmm ideally I wanted the lower repayment rather than shorter term. 

I’ll check with the lenders if decide to go ahead.