I'm sorry, another spec me thread...

[rossk26]

Yes I was just about to pay, had my credit card in hand and just before I wiped myself of 2 grand I asked if her calculations were correct. I chose the earlier term as the interest rebate was £52 but then I asked her to repeat the final payment dat, which she said was October 2014, and I asked her if that was definabley on 2 months earlier than my current final payment date, which she confirmed. I think she said my last payment was reduced to £192 too but again that's still costing me £2k to only save under £500...

She said something about there still being capital and interest. I thought it was better to pay chunks off, not cost you to do this.

 

[rossk26]

Hold the boat, I have potentially found the answer for you - when did you take this loan out?

see here:

http://metafaq.tescofinance.com/help/loans/add_payments

If the application was after June 2010 then the person you spoke to did something seriously wrong with their calculations - if it was before this then it looks like you were too early for the new regs.

I applied after June 2010.

 

[rodenal]

Then she is very likely to be incorrect - ask for a written statement as you have potentially been given duff figures there.

If you check tesco's own information on that page it tells you (albeit in a clearer way) what i've stated previously r.e early part repayment. Point the next person to the same page and ask for an explination along with a formal, written calc

Oh and btw the interest rebate on £2k for 2 years 8 months is likely to be well over £52, more like £150-200 at least, unless you're on an apr of about 1%

 

[[TW]Fox]

She is wrong.

The Consumer Credit Act now allows for partial or full overpayment at any time with only a limited charge allowed.

If you have a £6k loan with 2 years outstanding say and you pay £4k off you can either:

a) Significantly reduce your monthly payments and retain the original term of the loan
b) Significantly reduce the remaining term on the loan but retain the same monthly payments.

Both will save you large amounts of interest - you'll save 2 years of interest on £4k at whatever % APR your loan is if you paid £4k off now with 2 years left!

It is completely daft to be putting money into a savings account if you have outstanding debt at presumably 3-6 times the interest.

 

[rossk26]

She is wrong.

I agree.

I've done the sums in my head and I can't figure out how she plucked these numbers from thin air. Will ring again later this afternoon, hopefully a true answer will arise.

I pay £2688 a year, so surely just by simple maths, If i give them £2688 I should reduce my term by 12 months? Never mind the interest rebate I would get on doing it as well...

 

[rossk26]

Ok so rang tesco again this afternoon (spoke to a Scottish male this time)!!!!!

After a re-quote for paying £2000 off on my loan I will reduce the term by 11 months. The other option was to reduce the monthly payments from £224 to £149, which was really tempting, but the shorter term is more beneficial! As the interest rebate was over £400

Will be repeating this method around September again, as I have a few expensive months in the summer! Then hopefully I should knock a similar length of time off the loan and it should be paid off just after the new year. Is the plan anyhow!