Loan break down

Auntsally

Hi

I was just wondering if anyone can explain a problem ive got with a loan im thinking of applying for.

I've got bad credit and need a loan to get a new car, i was refused by halifax but my details were passed on to Affinity to get me some finance which they've managed to do.

Im just slighty confused about the figures they've got and just wondered if anyone can help me before I call them tomorrow. I know nothing about how APR breaks down so could really use some advice. Here's how it is

Need £5995 for car which they're offered me.
They say APR is 10%
Monthly repayments over 5 years £159 per month without payment protection
This makes the total amount payable £9540 :eek: Is that not a wee bit too high?

If im completely wrong and that's the amount I have pay, then OK, but I just wanted to be sure before I sacrifice all that money.

Ta lovelies

C

Xbigman

Yes that does look too high. Are you sure it is 10% APR and not 10% flat rate?

Car finance can be quoted in flat rate which is much higher if worked out as APR.
Regards



X

AgeingSaver

Morning AuntSally

I agree the figures you quote don't stack up.

£5995 over 60 months @ 10.00% APR (without PPI or additional fees) should be about £126/£127 per month repayments.

On the same basis as above, £5995 over 60 months @ £159 per month equates to an APR of 21%/22%.

Another way to look at it is:
£159 per month over 60 months @ 10.00% APR should cover a loan of £7550.

The following possibilities occur to me:

1. The Broker and/or Lender have made one or more mistakes in some of the figures they have quoted you.

2. The Broker and/or Lender have misunderstood your requirements, e.g. they have included PPI (Payment Protection Insurance).
(Just an aside - Martin did an excellent TV item the other evening on the scandal of PPI).

3. The Broker and/or Lender have not mentioned, or made clear, that the quoted monthly repayment of £159 includes some Fee, Commission or other charges.

And, for the sake of balance,
4. It just might be possible that you have misread or misunderstood some or all of the figures provided by the Broker and/or Lender.

My advice is to read all information you have received from the Broker and/or Lender very, very carefully, especially any 'small print', until you are completely sure you understand what it all means.
Then contact the Broker and/or Lender to obtain any explanation/clarification re anything you don't understand. Quote the figures shown above and ask why theirs are much higher. Request they confirm their explanation in writing.

I would be inclined to keep trying for a better deal elsewhere and check out any new quotes with the same thoroughness.

Very best wishes

DavidHM

If you have bad credit, why do you need to spend £6k on a car?

If you're not getting the best possible deal, because of your bad credit, why do you even want to spend £6k on a car?

What's the car that you want? Are you sure it's the best deal for you? Even if it's worth £160 per month to you to be driving that car now, will you feel the same way when the car is (eight?) years old and you're still paying off the loan? Many places that offer finance and focus on the monthly payment also don't do the best deal on the car, either.

My suggestion to you would be to go over to the motoring section of this forum, or to http://www.honestjohn.co.uk and set out the whole deal. As far as getting the best deal on the loan is concerned, the smart search on http://www.moneysupermarket.com/loans/ will give you a good idea as to what is a realistic repayment and rate for your circumstances.

tom188

If its a new car remember they can lose 30-40% of their value in the first year.