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Paying off a loan early

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  • 26-07-2005 2:34pm
    #1
    seamus
    Registered Users Posts: 68,317 ✭✭✭✭


    Sorry if this sounds like a rtfm question, but legal docs give me headache. I want to pay off a BOI variable-rate motorloan almost 2 years early. I know if I ring banking 365 they'll just tell me to go to my branch, but that's no use during working hours.

    Do I need to give them notice of the intention to pay it off, and I assume there are penalties too?


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    #2
    Gilgamesh
    Closed Accounts Posts: 2,239 ✭✭✭Gilgamesh


    no you don't, as soon as the loan is paid, the account for it is closed.
    this will be in the T&C of the contract, so don't worry about it, if you can pay it off, then good for you


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    #3
    dahamsta
    Banned (with Prison Access) Posts: 16,659 ✭✭✭✭dahamsta


    On penalties, any time I've asked about fixed V variable I've been told that fixed rate loans attract penalties for early payment, but variable rate loans don't. Dunno about that in practise though.

    (Is it practise or practice? I can never remember.)

    adam


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    #4
    landser
    Closed Accounts Posts: 648 ✭✭✭landser


    i did this a while ago. I paid off the loan on-line, then rang my branch and told them. they then calculated interest due to that date and applied that to the account which i then paid off. this was a fixed rate loan and there were no penalties.


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    #5
    parsi
    Site Banned Posts: 5,904 ✭✭✭parsi


    My first fixed rate had a complicated forumla for early repayment. The last one I paid off early didn't have any of it - just ring the branch ask them for the balance to close the loan and its usually valid for a couple of days.


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    #6
    RainyDay
    Closed Accounts Posts: 6,925 ✭✭✭RainyDay


    Under the Consumer Credit Act, there can be no penalties for early payment of a variable rate loan. There may be issues around outstanding interest which isn't showing in the balance on your account, but if you make one payment now, then a final one when the next interest charge hits, you should be fine.


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    #7
    is_that_so
    Registered Users Posts: 32,136 ✭✭✭✭is_that_so


    Variable is no big deal , just call the bank and find out how much you owe and all the loan account details. I've done it a few times. Fixed loans can have penalties. As some of the other posters have said the loan account is automatically closed.
    If it was a 365 loan then call 1850 365 100 and they'll tell you what to do


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    #8
    seamus
    Registered Users Posts: 68,317 ✭✭✭✭seamus


    Cheers guys. Easy peasy.


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    #9
    Cuauhtemoc
    Registered Users Posts: 417 ✭✭Cuauhtemoc


    If you had payment protection on it make sure they refund the remaining 2 years to you as this would generally be factored into the cost of the loan at the start.


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