How to pay off your personal loan quicker

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When taking out a personal loan, you will do so ensuring that the repayment amounts you have committed to are affordable. We understand that your personal circumstances may change from time to time, and we would be sympathetic towards any customer that needed to revise their payment amount should they lose their job or face another scenario that would see them short on money for a period.

Likewise, personal financial circumstances can also change for the better, which may see a customer decide they wish to pay off more of their loan at once or make a larger payment as a one-off. This would help to pay off a personal loan quicker, while there may be other possibilities for doing so. At [name], our aim is to ensure that all our customers benefit from our simply personal service, and an important part of that is helping you to understand all your options for paying off your personal loan quicker.

What are the opportunities available to you?

Opting for Higher Repayment Amounts

By choosing to repay your [name] personal loan over a shorter period, you will pay a higher amount each week or fortnight, yet save money over the course of the loan owing to the lower level of interest you will pay. Individuals will often choose a repayment amount that leaves them other disposable income, which is understandable. However, we would encourage you to look at your budgeting and try to choose as high a repayment amount as is manageable for you.

Don’t ditch your lifestyle completely and wipe out your disposable income, but do consider the options you will make by taking this route. You can call us to speak to one of our personal loan experts or use our personal loan calculator if you’re unsure.

“At NOW FINANCE, our aim is to ensure that all our customers benefit from our simply personal service, and an important part of that is helping you to understand all your options for paying off your personal loan quicker.”

Make a One off Payment

If you chose a longer loan term and lower repayment amount to err on the side of caution, you may find you have money left over at the end of the month. In this instance, you may wish to use this sum to make an additional payment towards your loan balance. Should you believe this is likely to be a scenario that will present itself during your loan term, you should check the terms and conditions regarding additional payments, as you may need to pay a fee.

Sometimes making one off payments will not actually save you any money, as the full amount of interest may still be applied and where fees are involved you may even end up spending more, though you will achieve paying off your loan quicker.

Consolidating Your Loan

If you have more than one personal loan, or you have a range of other debts that you are currently paying off, then a debt consolidation loan may be a suitable solution for you. While you will still be in debt, a consolidation loan will enable you to pay off an outstanding personal loan and may also mean you reduce your interest and repayment amounts.

Should you take the option of consolidation as a means of paying off an existing personal loan, you should consider the higher regular repayment or one off payment options when planning your debt consolidation loan period and regular repayment amount.

“If you have more than one personal loan, or you have a range of other debts that you are currently paying off, then a debt consolidation loan may be a suitable solution for you.”

Only Borrow What You Need

At [name], we’ll speak to you about the reason for your loan to ensure you only borrow what you need for that specific purpose. While borrowing more than you need ‘just in case’ might seem a good idea, ultimately it means you accrue more debt and therefore pay more interest than you really need to.

Paying Off Your Personal Loan Quicker

There are many factors to consider when planning to take out a personal loan. We recommend you look at all the options carefully to ensure you don’t spend more than you need to on interest, or take longer to pay off your loan than you perhaps need to.

You will always have options available for paying off your personal loan quicker, and can contact us at any time during your loan period, or before taking out a [name] personal loan, to inquire about the options available to you.

Disclaimer:  This article contains general comments and recommendations only. This article has been prepared without taking account of your objectives, financial situation or needs. Before taking any action you should consider the appropriateness of the comments made in the article, having regard to your objectives, financial situation and needs. If this article relates to the acquisition, or possible acquisition, of a particular credit product you should obtain and consider the relevant disclosure documents before applying for the product.

Approved customers only. Terms, conditions, fees and charges apply. All applications are subject to NOW FINANCE’s lending and approval criteria. Settlement times may vary depending on circumstances. Loan repayment terms range from 18 months to 7 years. Interest rates range from 7.95% p.a. (9.56% p.a. comparison rate) to 16.95% p.a. (18.53% p.a. comparison rate).

*Comparison rates are based on a loan of $30,000 over 5 years.

WARNING: This comparison rate is true only for the example given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate.

EXAMPLE: An unsecured personal loan of $30,000 borrowed for 5 years with the interest rate of 7.95% p.a. (9.56% p.a. comparison rate), would estimate to a minimum total amount payable of $37,741.60 via the weekly payment option (including a $495 establishment fee and $13 per month administration fee). Rates are subject to change.

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