What if I want to pay my Loan off early ?

Before agreeing to your loan, read the terms and conditions of the agreement. Some loans allow you to pay your loan off early without any penalties, however, some don't.

If your loan does not allow for early payment, and you wish to pay it off early, you will need to ask your lender for a redemption or early settlement statement. This statement will show how much you will have to pay to complete the loan. They will charge you for some of the loan interest that would be due over the remaining term of the agreement.

Unless the loan only has a few months to go you will not be required to pay all the loan interest due over the remaining term. The method for calculating the loan settlement figure varies - the maximum you will repay is calculated using "the rule of 78" (this is a calculation governed by the consumer credit act 1974).

If you think your situation may change and you may have the ability to pay the loan off early, make sure you get a loan that allows early repayment, that way you know there will be no penalties.

Risk Warning
Your home may be repossessed if you do not keep up repayments on a mortgage or any debt secured on it. Security by way of a charge on your home may be required.
Think carefully before securing other debts to your home.

Frequently Asked Questions related to the above topic.
Click below if you wish to read them: -

• What happens if you need cover quickly in order to complete a house purchase?
• You have a Repayment Mortgage. What sort of Life Insurance do you need?
• You have an Interest Only Mortgage. What sort of Life Insurance do you need?
• Should you include Critical Illness Insurance on your policy?
• You want to ensure that your monthly mortgage repayments are paid on your behalf if you were off work due to sickness, accident or unemployment. What sort of insurance do you need?
• No proof of income ?
• What is a secured loan ?
• I live at home can i still get a loan ?
• What if I already have a loan or a mortgage secured on my home ?
• What is a Loan to Value (LTV) Ratio?
• In what circumstances should I consider taking out a personal loan?
• Go to menu of Frequently asked Questions about Mortgage Life Insurance
• Go to menu of Frequently asked Questions about Critical Illness Insurance

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