Audi Car Finance

Skintman_2007

I'm a little confued by an offer from Audi to finance the purchase of a new car using one of their own finance packages.

They are offering a "flat rate" credit deal of 3.65% - I was looking to finance a loan of £33,750 over 3 years and the monthly repayments quoted are £1,040.16 per month. So Audi arecharging £3,695 for the privilidge of borrowing the cash - which looked expensive to me.

I did a quick check on a web loan calculator (Guardian Money) and calculated the repayments at £991.19 per month, which is £1,736 less over the 3 years.

The explanation from Audi is that HP agreements are "front-end loaded" rather than a reducing balance, hence the higher overall cost.

This all seems a bit odd to me, am I missing something here and have got my sums wrong or are Audi pulling a fast one?

Thanks

dogzilla_2

Usually when the interest is that low they mean that much ontop of the BASE RATE.

Eg they say 2% but they mean ontop of the 5.xx base rate. (cant remember its forever changing!!)

iceman_2

Think that's wrong dogzilla, flat rate usually means you pay that percentage interest of the total balance every year (ie, doesn't take into account the amount paid off). Usually you double the rate to get the APR altough Audi will tell you the APR if you ask them. (So about 7% which isn't too bad for car finance)

Gray0103

I am actuallly considering buying a new or nearly new audi (depending on the package), and audi don't have a calculator on their website you only get the details if you phone up and ask.

So instead I have looked at getting 2 credit cards (one for me, one for the wife) and using them for 12 months 0% on purchase and use savings for the rest.

I will get a cash allowance from work so will use that to pay off the minimum repayments and put the rest in an ISA.
When the 12 months are up I can hammer the cards and assess my next move.