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- Early Repayment Charges - |
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Interest on a loan is calculated as a percentage of the outstanding balance, not the full amount. Every month you should pay one-twelfth of the APR of the balance, but this would mean that your repayment would be different every month. So to make standing orders predictable, lenders calculate the total loan plus the total interest and divide it by the number of months, and this figure becomes your monthly payment. If you decide to settle your loan earlier than planned, these calculations will turn out to be inappropriate, which is one reason why lenders will demand an early repayment charge should you decide to do so.
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A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
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| Think carefully before securing other debts against your home. Your home may be reposessed if you do not keep up repayments on your mortgage or any other debt secured on it. Loans secured on your home. |
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