Early Repayment Penalties

When taking out a loan, some companies will add penalties for paying more than the agreed monthly amount because of possible lost interest that would normally be charged.

 

Ideally, it is best to use a company that won’t charge for this but they can prove difficult to find. If you search around then you might get lucky but the overall rate of the loan could be higher to cover the fact no early payment charges would be added.

Top Tip: If you do want to pay extra to clear the loan, it is best to stick to the payments set down by the lenders until you are able to clear the outstanding sum in one payment rather than more on a monthly basis, this will not reduce your loan by much. Most of the payment will be just repaying interest added.