A MARTIN Lewis fan has revealed how they managed to save £1,300 on their car payments thanks to a clever tip.
Danny revealed how he cut his interest costs by switching to a loan following MoneySavingExpert‘s (MSE) advice.
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It comes after he read Martin’s story on the consumer site suggesting people may be able to save by getting a new loan to pay off an existing loan with a high APR.
Danny managed decided to look into it after reading and found he could save a whopping £1,300.
He said: “Just wanted to thank you as I looked into what I still had left to pay off on my car finance.
“By taking a loan, I could pay less interest, and less each month.
“I couldn’t believe how much I saved – over £1,300. A big thank you for all your good info.”
MSE says that while loan rates have risen slightly recently, they’re still pretty low.
The experts shared how to get the best new deal and even provides a calculator to help you work it out.
Firstly, you’ll need to find out how much it would cost if you were to pay off your existing loan right now.
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This is the full debt plus any early settlement penalty charge.
Then you’ll need to find how much exactly you’re paying each month, and how long you have left to pay.
You might need to contact your lender to find this information out.
Once you’re armed with all the key details, have a look at the best-buy rates available to you.
You can use MSE’s eligibility calculator to check the likelihood of being accepted for each loan.
Among the cheapest loans for between £1,000 to £1,999 currently are from Santander at 14.5% rep APR.
For £2,000 to £2,999 Novuna Personal Finance is offering 14.4% rep APR over two to five years.
There’s a huge variety available and listed on the MSE website for up to over £25,000.
It’s important to remember to read all the terms and conditions to make sure the loan you choose is right for you.
Finally, to get your magic saving number enter your current loan information with your new information into the MSE loan switching calculator.
It will tell you exactly how much you can save, then you can apply for the new loan to pay off your costly existing one whilst still saving cash.
Meanwhile, here’s four tips to get the best deal when borrowing for your next car.
Plus, the hidden car finance clause that could help you end a contract early without a fee.
Do you have a money problem that needs sorting? Get in touch by emailing [email protected]
