Car Loan - APR Help !!!

pmday2013

Hello everyone,

I'm new to this site, so apologies is i'm asking the obvious. I have recently purchased a car on finance on Monday of this week (6th July) it was £5299 with an £800 deposit so I have to pay back £4499.

The monthly payments are £106.92 which I am happy to pay over 60 months. However the APR is 17.3% which I am confused about.

What does the APR do? Does it mean that my monthly payments will jump up? Does it mean that I have to pay a lump sum of interest every year to the bank?

I am probably still in the cooling off period with the finance people, should I cancel the finance and get a bank loan?

EZTutty

APR is the Annual Percentage Rate, this is to provide an indication of how expensive interest on a loan is on an Annual Basis.

By my calculations the £106.92 per month, includes the Interet this and is the total amount per month you should have to pay, it should never change, and there should be no lump sump payments (however the rate seems more like 16%)

The Lower the APR the better, if you google 'APR calculator' you should be able to find something to work monthly repayments etc out.

Hope this helps

~Brock~

If you signed the agreement on the premises of the car dealer then you have not got a cooling off period.

CLAPTON

as eztutty says, the APR just gives you the interest rate which you can use to compare with other loans.

you will be repaying 6,415.20 in total (i.e. 60 x 106.92) for your 4,499 loan so you pay £1,916 in interest.
some people would consider paying that much interest as absurd while many would think it reasonable.
Maybe you should consider buying a cheaper car or saving up first.

pmday2013

The paper work says that in total i'll be paying £7299.00 or a figure there abouts, I don't have the paper work to hand at the minute. The paper work states 58 x 106.92 + the first montly payment of 170.00 and a final payment of £256.00 (I think), would the 800.00 deposit then be added on to this figure to make the £7299.00 figure?

~Brock~

pmday2013 wrote: »

would the 800.00 deposit then be added on to this figure to make the £7299.00 figure?

Yes it would.