Being in a position to pay back your loan early may seem like a good thing. However, not all Loan arrangements allow you to repay your loan early without charge.
Early repayment often means the loan company will miss out on interest payments, so in order to compensate for this, they attach fees to the loan. If you feel you’re in a position to repay your loan early, you could consider searching for a loan that allows you to do this without incurring a penalty. On the other hand, finding a loan with no early repayment penalties may mean you pay a higher rate of APR during the loan term, so it’s important to compare what’s available and work out which loan is best suited to your needs before signing up.