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Author: Subject: Can anyone tell me if this loan is cheap?
bitsilly
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posted on 9/2/11 at 06:31 PM Reply With Quote
Can anyone tell me if this loan is cheap?

I am soon (with luck) moving house.
I have been offered a loan of £35K towards the move. For this they ask for £125 pcm on interest only basis (ie I pay back the 35K whole later on).
There is no set up fee and it means that the interest money is kept in the family, but can anyone tell me if it is good value?
I will ring the bank tomorrow for a quote but if it is a close call, as I said, I'd rather pay family than a bank.
It is near impossible to work out how the offer equates to others available on the interweb!
As my headache developed I thought I'd pass it on!
Many thanks gents.
Ed

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dilley

posted on 9/2/11 at 06:38 PM Reply With Quote
Take it!
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dilley

posted on 9/2/11 at 06:39 PM Reply With Quote
It's 5%!
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blakep82

posted on 9/2/11 at 06:42 PM Reply With Quote
yep, take it i think. an interest only mortgage (about 5% with halifax) is about £160 a month, so seems a good deal. yours seems about 4.2%? somewhere around there?

as long as it doesn't cause family problems... money has a habit of causing trouble with family
the conveyancing solicitor will want some kind of contract drawn up probably

[Edited on 9/2/11 by blakep82]





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snapper

posted on 9/2/11 at 06:48 PM Reply With Quote
The problem is you will have to take out an endowment or save using ISA to get 35k to pay back endowments are s4it at the moment, I have been chasing mine for years and have been paying capital back to cover shortfall





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bitsilly
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posted on 9/2/11 at 07:03 PM Reply With Quote
Cheers Gents!
The original amout will be paid off ASAP using my wifes bonus, no additional plan required.
The advice is much appreciated.
Regards

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TimC

posted on 9/2/11 at 08:23 PM Reply With Quote
If it was the place we spoke about you could even recoup some of that by renting me some garage space!






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stevebubs

posted on 9/2/11 at 08:39 PM Reply With Quote
quote:
Originally posted by bitsilly
Cheers Gents!
The original amout will be paid off ASAP using my wifes bonus, no additional plan required.
The advice is much appreciated.
Regards


Can I have your wife? Mine only spends my bonuses...

[Edited on 9/2/11 by stevebubs]

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carpmart

posted on 9/2/11 at 10:01 PM Reply With Quote
quote:
Originally posted by stevebubs
quote:
Originally posted by bitsilly
Cheers Gents!
The original amout will be paid off ASAP using my wifes bonus, no additional plan required.
The advice is much appreciated.
Regards


Can I have your wife? Mine only spends my bonuses...

[Edited on 9/2/11 by stevebubs]


+1 - has she got a well paid sister?





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JoelP

posted on 10/2/11 at 08:27 PM Reply With Quote
seems fair all round to me, you get a loan much cheaper than unsecured finance (which is about 7 or 8% at the min), indeed you mortgage APR will be around this rate depending on your deposit, plus the person lending you the money gets more interest than a savings account, and probably wont pay income tax on the payments!






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owelly

posted on 10/2/11 at 09:15 PM Reply With Quote
I borrowed £150k to buy my house and I'm paying back £336 a month in interest!





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Puzzled

posted on 10/2/11 at 09:46 PM Reply With Quote
Family


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Puzzled

posted on 10/2/11 at 09:48 PM Reply With Quote
Dont ya just love them. I"m available for adoption.!!!.
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daviep

posted on 10/2/11 at 09:48 PM Reply With Quote
For comparison purposes as blake said £125 per month on £35K works out as about 4.3%

For an unsecured loan this would be a great rate but compared to mortgage rates at the moment it's not bad but not brilliant either.

Davie





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