working out aprs/flat rates

Benson

Im taking out HP and the dealer has given me a lot of figures but the figures keep changing so is there a table that I can put in the amounts to be loaned and the monthly payments and it will tell me the APR?

Also which is better to go off the flat rate or APR? different dealers use different ones??

CLAPTON

All loans must by law specify the APR.

Car dealers however, just love to quote the 'flat' rate as it looks a lot cheaper (they will say to make it simpler for you sir)

The real APR is appoximately twice the 'flat rate'

So if you see one loan at say 15% APR
and another than quotes a flat rate of say 10% then the real APR is about 20%APR

then the first will work out cheaper.

Always ask for the APR and ALWAYS look at the paperwork before you pay a deposit, agree to anythong or sign anything.

so

1. take a simple calculator with you
2. Always ask for a quote loan showing for the APR and the total cost in writing
3. before agreeing take the written quotes away so you can look at them at home

also of course consider saving up the money first and that way you avoid paying interest

Unless you want the ability to voluntary terminate the deal the usually a personal loan from the bank works out cheaper