Loan APR

steve03

can anyone help ?
got a loan out last year to buy a caravan, was told 5.25% for the loan. Looking today at the loan agreement and noticed 5.25% was the interest rate per year:( and we are paying 10.3% APR.
On the order form it states 84 months and rate 5.25% which we thought was the APR.
can anyone tell me if this is a miss sold loan as it does not state the APR on the order form or base rate just states 5.25%

bengalknights

If it says 5.25% year then that to me would be the APR (Annual percentage rate)

How much is the loan, the monthly payments and the duration?

opinions4u

What does it say the APR is on the loan agreement?

chambta

The 'flat rate' and the APR are two different things.

bigadaj

Vehicle dealers commonly quote flat rate which is half the apr. I would have thought the apr would have to be quoted somewhere on documentation, if it isn't then complain, formally I. Writing.

iolanthe07

This is a common con trick used by the motor industry. They quote flat rate in big headlines, but somewhere hidden in the paper work will be the APR. I expect it will be in the small print of the agreement you signed - if it isn't you certainly have grounds to complain. Proving that it was 'mis-sold' though will be difficult.

debtcutter

Is it just a normal unsecured loan, or a finance agreement/HP etc?

steve03

Thanks for all your help
In the small print on the finance agreement, it does mention 10.3% APR on the order form it just mentions 84 mths and RATE 5.25%

Apples2

Typical car Dealers. They try to waffle that it is easier to work out using Flat Rate.

I wonder if they would use it if it meant Flat Rate was double the APR? doubt it!

You're not the first one to be hoodwinked Steve, and definitely won't be the last..... Never trust a Used Car Salesman!

dresdendave

Obviously it's easy to be wise after the event but the lesson you hopefully have learnt for the future is to check agreements before you sign them, not wait until the following year.

Eonel

This is not just the practice of used car salesmen - it is prevalent across the industry including new showrooms of premium marques. The law says they have to quote the APR on the agreement & that is what they have done. Borrower beware!