To early repayment or not - Sainsburys Loan

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Cdunner
Cdunner Posts: 3 Newbie
in Loans
Hi,

Looking for advice on whether to clear my Sainsbury's Loan with an early repayment or to hold the funds and repay using standard monthly payments over time..

Early repayment price: £2467.98
Overall remaining payments: £2424.15 with 15 months remaining
Diff : -£43.83

Just wondering which would be better for credit etc. and is there any benefits to either path?

Thanks for the help
Ciaran:beer:

Comments

  • ViolaLass
    ViolaLass Posts: 5,764 Forumite
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    Do you have the money? What's the interest rate?
  • Cdunner
    Cdunner Posts: 3 Newbie
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    I do have the money just recently acquired.

    It was a £5000 loan to repay total of £5817 over 48 months.
  • PeacefulWaters
    PeacefulWaters Posts: 8,495 Forumite
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    There's no point paying interest to make your credit file look good.
  • Nebulous2
    Nebulous2 Posts: 5,116 Forumite
    First Anniversary Name Dropper First Post
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    I don't think your figures can be right. Did you get a settlement figure from the lender or are you looking at some online figures?

    The most they are allowed to charge for early resettlement is two months interest, meaning you'd effectively save 13 months interest on a reducing balance.

    If you have other credit reporting accounts, such as a credit card paid in full every month I'd settle to save the interest.
  • ViolaLass
    ViolaLass Posts: 5,764 Forumite
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    Nebulous2 wrote: »
    If you have other credit reporting accounts, such as a credit card paid in full every month I'd settle to save the interest.

    Even if you don't, settle anyway and get a credit card.
  • Cdunner
    Cdunner Posts: 3 Newbie
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    Brilliant thanks all
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