Overdraft cheaper than a loan?!?

ste_bla · 24 Feb 2008 at 10:51

Looking to borrow 2 grand but pay if off over 2 years

I cant see anywhere that will do low-ish %, Natwest will do an overdraft for 18.49% and there loans are 19.99%!

Any ideas where you I could try to get a lower % or even a comparison site?

The Mad Rapper · 24 Feb 2008 at 10:52

Do you need to borrow it really? Is saving the money not an option?

The Mad Rapper · 24 Feb 2008 at 10:53

If you must borrow, then have a look at the Money Saving Expert web site. They have loan comparisons which you may find useful.

GarethDW · 24 Feb 2008 at 10:53

moneysupermarket.com

http://www.moneysupermarket.com/loa...1&C9=2&PayOffExisting=&PPI=0&SecuredLoanType=

(not sure if that link will work, but it's for a 2K loan over 2 years).

ste_bla · 24 Feb 2008 at 10:54

The Mad Rapper said:
Do you need to borrow it really? Is saving the money not an option?

For a car we need (2 busses a day) with another kid on way (due 3 weeks), I could afford to pay more off a month but well dont want to, prefer to have money in bank just incase. Dont mind paying the interest but if i can find a lower rate thats even better

hope that makes sense

The Mad Rapper said:
If you must borrow, then have a look at the Money Saving Expert web site. They have loan comparisons which you may find useful.

GarethDW said:
moneysupermarket.com

Cheers I'll have a look

lakitu · 24 Feb 2008 at 10:58

Most bank's loan rates are far cheaper than 18%, more like 6% upwards. I would opt for the loan. Try http://moneyexpert.co.uk it's pretty good for comparing loans etc.

Butters · 24 Feb 2008 at 11:02

Your idea is fine with the added benefit of being able to take chunks out of the overdraft as and when you have spare case (which you can't do with a normal personal loan). Do Natwest offer a Flexi Loan? Its like a glorified overdraft but remains seperate from your normal account and you can overpay to it, but a regular payment still goes out too.

Thing to watch out is, their loan rate may be 19.9% but that is for the life of the loan, their overdraft fees are compounded and get applied each month, meaning in the long run (say over two years), it would cost a lot more to repay the overdraft if you paid the same (or less) towards it than you would a set amount for a loan.

There is always the credit card option as long as you can secure the limit and find one with 0% on purchases until say Feb09

ste_bla · 24 Feb 2008 at 11:04

Butters said:
Your idea is fine with the added benefit of being able to take chunks out of the overdraft as and when you have spare case (which you can't do with a normal personal loan). Do Natwest offer a Flexi Loan? Its like a glorified overdraft but remains seperate from your normal account and you can overpay to it, but a regular payment still goes out too.

Thing to watch out is, their loan rate may be 19.9% but that is for the life of the loan, their overdraft fees are compounded and get applied each month, meaning in the long run (say over two years), it would cost a lot more to repay the overdraft if you paid the same (or less) towards it than you would a set amount for a loan.

Flexi is £5k upwards which I just dont want/need

Also thanks for the compound interest forgot about that!

Butters · 24 Feb 2008 at 11:17

Oh, its not like HSBC flexi loan? Its a min of £5k, but you only draw out what you need and the repayments and interest are based on that and not the full £5k

ste_bla · 24 Feb 2008 at 11:21

Butters said:
Oh, its not like HSBC flexi loan? Its a min of £5k, but you only draw out what you need and the repayments and interest are based on that and not the full £5k

Oh might have another look then I just saw from £5000 upwards