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Front Loaded Loan Overpayments
I recently made an overpayment on my loan with First Direct. I thought I would see the value of the overpayment and an additional interest saving come off my loan balance but this wasn't the case. I contacted first direct and was told that as the loan is front loaded I will only pay off the loan with less payments and not actually save any money unless the load was cleared in full.
If this is the case I wouldn't of made the overpayment in the first place.
Does this sound correct? Cheers
If this is the case I wouldn't of made the overpayment in the first place.
Does this sound correct? Cheers
0
Comments
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No. The loan isn't front loaded.
You'll pay less interest as the balance is now lower. Your overpayment comes off the capital.1 -
Thanks for this, the balance hasn't come down on my app, is it just a case of waiting for a new statement to be produced?MorningcoffeeIV said:No. The loan isn't front loaded.
You'll pay less interest as the balance is now lower. Your overpayment comes off the capital.
I wasn't getting anywhere on the phone with them earlier0 -
How long ago is "recently"?0
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