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Paying off a loan

  • 04-10-2016 11:20am
    #1
    Utah
    Closed Accounts Posts: 426 ✭✭


    I've a balance of 3300 to pay on a CU loan.
    I have 4500 in savings with the CU.

    Should I pay it off with my savings so I won't have to pay the interest?
    My OH reckons I should hang on to the money in case there is an emergency.

    Thanks


Comments

  • #2
    Spocker
    Moderators Posts: 6,864 ✭✭✭Spocker


    +1 for hanging onto the money, especially if you can afford the repayments. You'll never know what you might need the 4.5k for


  • #3
    dogbert27
    Registered Users, Registered Users 2 Posts: 4,939 ✭✭✭dogbert27


    Spocker wrote: »
    +1 for hanging onto the money, especially if you can afford the repayments. You'll never know what you might need the 4.5k for

    As Spocker says if you can afford the repayments leave things be.

    If you cleared the 3300 you're left with 1200 euro. How quickly could you get back to 4500?

    Also if things are still as I remembered you can borrow up to 3 times your savings with the CU so potentially you could now borrow 13500 euro where as if you clear the 3300 and end up in a position that you need money you can only borrow 3600 euro from the CU.

    Should you be in a position where you can't meet the repayments you could try to flip the 3300 over a longer loan period reducing the repayment amount or pay a percentage from your savings and extend the loan so that the repayments are smaller.

    I guess what I'm saying is keep your money!! :)


  • #4
    Utah
    Closed Accounts Posts: 426 ✭✭Utah


    Ok yeah that makes sense.

    Yes, I can afford the repayments. I just thought I'd save a few hundred euro in interest.

    I'll leave it be so!

    Thanks


  • #5
    oEmmao
    Registered Users Posts: 59 ✭✭oEmmao


    id leave it be too, you can pay a little more per week if you want to reduce your interest, i might be killed for saying this but as well as paying off my credit union each week, i add another 20euro to savings to keep it bumped up :p


  • #6
    Utah
    Closed Accounts Posts: 426 ✭✭Utah


    oEmmao wrote: »
    I add another 20euro to savings to keep it bumped up

    I do that too :)


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  • #7
    Amirani
    Moderators, Society & Culture Moderators Posts: 12,527 Mod ✭✭✭✭Amirani


    Personally I'd pay down most or all of it, but it depends on your own situation really.


  • #8
    theoldbreed
    Registered Users Posts: 405 ✭✭theoldbreed


    No I'd keep paying off weekly or whatever. When the loan is gone you'll have a nice lump sum to spend how you wish. It will take you a while to build the savings back up again.


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