funding corporation bill of sale all doesnt seem right

jhig712419

Hello there sorry if this is long winded however need some help with the funding corporation.

I purchased a car from acf car finance in 2010 and now my circulmstances have changed i need to look into either returning the car or lowering the monthly payments however there seems to be several errors on the agreements i have found and studied carefully.

on the credit agreement regulated by the consumer credit act 1974

amount of credit £4,444,00
Total amount payable is £9,949.36
apr 49.9%
installment value 178.93
the period of the agreement 53 months.

however the bill of sale reads differently

it reads sum of £4,440.00
and interest at the rate of 24.76% a year
it also states the payment is 52 months

The bill of sale does not mention anywhere the total amount payable and also is signed by a witness who was my sales rep and witness sescription is entered as sales.

Also looking at my last account statement from the funding corporation that also appears to be wrong they are stating the apr is 48.9 %


Also i have just used the loan and apr calculator found on here and that also shows discrepensies

if i enter on a loan calculator £4,444,00 x 53 months at the apr of 49.9 it is showing i should be paying back over £11,000 however if the apr on the bill of sale is correct i should be paying almost £2.400 less than on the credit agreement and almost £50 less per month than my installments.



Help me please somebody

gb12345

Showing flat interest rates rather than APRs is a common motor trade tactic to make the deal appear better (they are typically 1/2 the APR as you can see).

Apples2

Nothing to add which hasn't been covered in all your threads on this same subject. I just hope your posts make people stop and think before signing up to these sort of deals.

Eonel

Not sure where you got to the £11,000 from - when I put your numbers in a loan calculator I get the same numbers as your credit agreement.

Re the difference in interest rates - g12345 is correct. There are many ways of representing an interest rates. 24.76% interest = 49% APR.

Credit agreements must display the APR. Other discussions or documents may not - and motor traders tend to talk in terms of a flat interest rate as it is a lower number.

Motor traders argue that the flat interest rate is the most transparent way to quote the rate. I can kind of see that - you borrowed at 25% flat interest for 4 years - your total interest payable will be 4 * 25 = 100% of the amount borrowed. ( btw that's a lot of interest to pay for a car that over the same period will half or greater in value ! )

The APR is the rate that reflects that interest in reality is a slightly more complex calculation - calculated on a daily basis and accruing at a reducing rate as the balance of the loan reduces.

The APR is the rate to focus upon. It is the fairest way to display an interest rate and is the only consistent way that you can compare interest rates accross different loan providers.