FordCredit...is this legal?

nicocathvog

Hello Team,
I was wondering if it is legal for the Hire purchase companies (like mine FordCredit) to charge £125 for them to search our credit situation. We are with CreditExpert and know that we paid only £6.95 for us to get our credit report. Why should we have to pay for them to search us?
Also they will charge us £95 when we finish paying for our new van - which they say is the charge for the letter that tells us our payments have finally finished! Surely our direct debit will stop paying when it is fully paid up? Why should we pay £95 for a letter confirming that?
We were told that this is the normal way things are done! Can this be justified?

~Brock~

nicocathvog wrote: »

Hello Team,
I was wondering if it is legal for the Hire purchase companies (like mine FordCredit) to charge £125 for them to search our credit situation. We are with CreditExpert and know that we paid only £6.95 for us to get our credit report. Why should we have to pay for them to search us?
Also they will charge us £95 when we finish paying for our new van - which they say is the charge for the letter that tells us our payments have finally finished! Surely our direct debit will stop paying when it is fully paid up? Why should we pay £95 for a letter confirming that?
We were told that this is the normal way things are done! Can this be justified?

You appear to mean an 'Acceptance Fee' / 'Document Fee' and an 'Option to Purchase Fee' in relation to a hire purchase transaction?

Firstly, if you think that the process of searching someone, underwriting them, checking out the vehicle, producing the paperwork, utilising anti fraud systems, setting up the loan, writing to you afterwards etc etc etc all comes under the cost of a credit search then think again !!!

Secondly, it is permissable for firms to charge a fee for setting up a loan, and in the case of HP, to arrange the transfer of ownership from the lender to the borrower at the end of the term. Providing these fees are correctly shown as part of the overall cost of credit and reflected in the quoted APR then they are perfectly legal.