M&S loan overpayment query

a82625

Hi all,

Can anyone with experience of M&S bank or industry norms explain whether the following is expected:
Took out a 10k loan for a car from M&S bank at 6.2%, total circa 11,100 hit my credit score, ie all capital + interest that would be charged.

I've overpaid 5,000 back from savings on mid November before the first payment is due; but the amount owed has only dropped by 5,000 exactly, with no adjustment for interest that will no longer accrue.

There is no online loan management account with M&S, so I just wanted to check whether anyone else experienced this overpaying a similar loan, and can confirm the interest won't be charged.
Thank you for reading.

CliveOfIndia

Any overpayment you make will reduce the overall amount of interest you pay.  What you've described does sound a little odd, I can only assume it's a result of the way the data is being displayed.

a82625 said:

but the amount owed has only dropped by 5,000 exactly

There is no online loan management account with M&S

Where are you seeing the adjusted figures - online presumably?  Or is this a paper statement that you've received through the post?

One thing to be aware of is that if you make an overpayment, some lenders will reduce the term of the loan whilst others will reduce your monthly payments.  If they take one approach by default, you can usually phone them up and ask them to take the other approach if that suits you better.  It makes little difference in terms of what you pay overall, but one may suit your personal budget better than the other.

Hoenir

Remember data isn't real time it's a snapshot on a given date. 

a82625

Thanks both. All data is on clear score and mse credit club, in effect all interest to term is shown on credit score. Probably their reporting ways.
M&S reduce term rather than payments, which is less interest.

CliveOfIndia

a82625 said:

All data is on clear score and mse credit club ... Probably their reporting ways.

Ah right, that would make sense.  Also bear in mind, the data you see on the free version of your credit reports is not real-time - unlike the paid-for version which a lender would use.

And even then, there's some variation in how often a particular lender will submit their data to the CRAs - usually it'll be either weekly or monthly, but each lender will have different reporting cycles.