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Should I pay my same day loan off early?

Should I pay my same day loan off early?

Paying my same day loan off early

Sometimes your financial situation can change dramatically in a short space of time. Perhaps taking out a same day loan has enabled you to embark on a business venture that’s paid off, or maybe you’ve landed some inheritance. Whatever the situation, you might be wondering if it’s a good idea to use your newly acquired funds to pay off your loan early. Here’s a few things you should consider beforehand.

Beware of early repayment penalties

Many banks and lenders add early repayment penalties into their financial solutions. There isn’t a single amount across the board, but the average is around one to two months’ interest. It’s still always worth writing to your lender and asking for an ‘Early Settlement Amount’ to see if it’s the right option for you. The reasoning for repayment penalties is so lenders can recoup some of the money that would have paid in interest if you had stuck to the original stated time frame.

Look out for different terminology

If you’re struggling to find ‘early repayment penalties’ in your terms and conditions, don’t just assume that your loan doesn’t have one. Different lenders call them different things. Other names for it are redemption charges, financial penalties and early redemption fees.

Pay back some of your loan

If there’s an option for a partial repayment, you may be able to decrease your monthly installments. Again, it’s worth getting in touch with your lender to find the best deal for both parties.

Explore your options

If you’re looking to take out a financial solution like a bad credit loan then it’s important to shop around and take early repayment fees into consideration. Here at Loan Bird, we can provide you with a multitude of different financial solutions for an array of lenders, so you can easily find the terms and conditions that suit your needs.