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  • FIRST POST
    • gord115
    • By gord115 13th Jan 18, 2:14 PM
    • 859Posts
    • 232Thanks
    gord115
    How much will i save paying off loan? Help needed.
    • #1
    • 13th Jan 18, 2:14 PM
    How much will i save paying off loan? Help needed. 13th Jan 18 at 2:14 PM
    I have a TSB loan at 2.9% apr for 11000 and have made 7 payments of 318.97
    I have 29 payments to make(318.97 x 29=9250.13)

    I have a settlement figure of 8979.43 thus saving me 270.70

    I now have the money to pay this off.

    The money is in my Santander 123 account earning 1.5% interest.

    I know it will save my money paying it off(especially as I will leave the 318.97 I have gained every month untouched) but by how much?

    Help much appreciated.
Page 1
    • Tom99
    • By Tom99 13th Jan 18, 3:23 PM
    • 2,240 Posts
    • 1,520 Thanks
    Tom99
    • #2
    • 13th Jan 18, 3:23 PM
    • #2
    • 13th Jan 18, 3:23 PM
    2.9% less 1.5% = 1.4% diff

    You are paying off 8,979 2.42 years early.

    If you assume the balance over those 2.42 years would be half the current balance then the amount you are saving is:

    (8,979/2)*1.4%*2.42yrs = 152

    Alternatively you could say the saving of 270.70 represents interest at 2.9% which you are replacing with funds costing you 1.5% so:

    270.70/2.9*1.4= 131
    • gord115
    • By gord115 14th Jan 18, 1:30 PM
    • 859 Posts
    • 232 Thanks
    gord115
    • #3
    • 14th Jan 18, 1:30 PM
    • #3
    • 14th Jan 18, 1:30 PM
    Thanks Tom, that's around the figure I came up with but wasn't sure.

    Much appreciated.
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