Document and Redemption Fees

mhenry9885

Hello,

Just reading through my Credit Agreement and noticed that there is a Document Fee of £450 and a Redemption Fee of £150 which has been added to the interest to calculate the Total Charge for Credit.

Does anybody have any idea what these are, a google search says that a redemption fee is a penalty for paying off the loan early??? If so, they have charged me up front!

Thank You.

jonesMUFCforever

A redemption fee is a fee to close off the account whether early or not.
If the charges were clearly pointed out to you on your loan documentation you have no reason to complain now.

mhenry9885

Who is complaining?

I asked what it was.......

jonesMUFCforever

Well if I was charged a total of £600 for a loan I would be complaining.

mhenry9885

What is a document fee then?

[Deleted User]

mhenry9885 wrote: »

What is a document fee then?

basically an admin fee for setting up the loan.... a rip off in other words

mhenry9885

Good Stuff!!!

iolanthe07

These fees are a scam to keep the headline APR down as much as possible.

opinions4u

iolanthe07 wrote: »

These fees are a scam to keep the headline APR down as much as possible.

If they're included in the total amount payable they should form part of the APR.

sophiasmummy

Is it for car finance? I used to work in the loans dept for a bank and these were always included within car finance agreements.

mhenry9885

Yep is was a loan for a car using the dealers in house finance company, funnily enough both the dealer and finance company are owned by the same chap.

Any ideas what the difference between APR and Equivalent Rate of interest as I have two different amounts on my credit agreement (apr is 46.9(!) and equivalent is 18)