Becoming debt free

[LosingGrip]

Condi said:

Can you not get a bank loan at a substantially cheaper APR and use that to pay off the high interest debt? Sainsbury's loans start at 2.?% APR, and that 6 or 7% saving will massively reduce the overall payable.

Your ISA should be making more than 3%, so leave that cash there and then simply pay back the cheaper loan. Or take some money out the S+S, pay back some of the high interest loan now, leaving enough savings for you to feel comfortable, and then borrow cheaply to cover the rest.

This is something that confuses me.

I've got a car on finance. The APR is ste (10% or so). If I was to get a loan to repay at a lower APR, would I save money? I can't see how as ill have to get a loan for say £15k to repay the finance.

[LosingGrip]

Glad I read this thread! Total payable is just over £14k if I keep with the finance company. However, switch to Nationwide (for example) and the payments go from £250 to £200 a month, or I can keep it at £250(ish) and do it over four years instead of five.

[Welshbeef]

LosingGrip said:

Glad I read this thread! Total payable is just over £14k if I keep with the finance company. However, switch to Nationwide (for example) and the payments go from £250 to £200 a month, or I can keep it at £250(ish) and do it over four years instead of five.

You stated 42 months to go - so if @ £250pcm that’s £10,500 total

[LosingGrip]

Welshbeef said:

You stated 42 months to go - so if @ £250pcm that’s £10,500 total

58 months to go (only got the car recently). £14298.58 if I let it carry on, or can pay £11,412.06 today to cancel it. £11,500 with Nationwide is £12,288 over four years (similar monthly payments). Just got to wait for some paperwork to turn up and take my work contract to the bank (only started there at the start of July).

[Welshbeef]

LosingGrip said:

Welshbeef said:

You stated 42 months to go - so if @ £250pcm that’s £10,500 total

58 months to go (only got the car recently). £14298.58 if I let it carry on, or can pay £11,412.06 today to cancel it. £11,500 with Nationwide is £12,288 over four years (similar monthly payments). Just got to wait for some paperwork to turn up and take my work contract to the bank (only started there at the start of July).

Is that the only debt?

If you’ve posted on here wanting to be debt free only 2 months into a 60 month car loan? But you had the cash available to pay for it cash.

[LosingGrip]

Welshbeef said:

Is that the only debt?

If you’ve posted on here wanting to be debt free only 2 months into a 60 month car loan? But you had the cash available to pay for it cash.

It was a reply at Condi. I wasn't aware I could get a loan with a cheaper APR and save money. I believed that my settlement price would be the full price if I let it continue for the full five years. I haven't got the cash laying around.