Paying off a loan early

Hi all i'm just looking for some advice.

im 16 months into a Fixed-sum re-financing loan of £3900. I pay 98 quid a month for 48 months (10% apr with Lloyds TSB). I've got the money to pay it back but I'm just wondering is it worth it. Would I have to give the interest of the 48 months back?

In the terms of the loan it does say that if I repay the loan back early I must pay a admin fee of 58 days interest (max £250).

Finace is not my strong point, so please can somebbody advise?

Thanks in advance for your words of wisdom!

Nia

Comments

  • meyore
    meyore Posts: 2,721 Forumite
    It looks like you have to pay 2 months worth of interest to them as a penalty for repaying early, so it would save you money on interest in the long term if you repaid now. If you've got the money it would be a good idea to repay the lot because the interest you pay on the loan is more than you could earn on it in the bank.

    I'm rabbitting on now, sorry! :o

    Best idea is to contact them to ask for an early settlement figure.

    Jo xx
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  • Sea78
    Sea78 Posts: 6,185
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    Have you decided to pay it off early? it certainly seems like the cheapest option despite the 58 days interest charge.

    sea xx
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