Loan total wrong?

catota

Hi everyone, hope someone can advise:
I bought a bed from dreams on hp but think they have calculated the final total wrong.
Cost of bed: £930
Term of loan: 36 months
APR: 29.8%
Monthly instalments: £48.87
Total amount payable: £1759.32

I appreciate that I may have got this wrong but I believed interest was calculated every year on the remaining debt. I have used nearly every APR calculator online and my total always comes up at around the £1420 mark. I have phoned customer services twice but they are unable to help as no one knows how to calculate the total using the APR. One did attempt she calculated 29.8% of 930 and x 3 to get total interest. Is this right? Hope someone can clarify. Thank you

lee111s

WoW that's a very high APR...did you not consider getting a 0% on purchases credit card?

catota

Had just bought a house and all our money went into the deposit, we didn't have a bed so I foolishly bought hp, I'm hopefully a little older and wiser now!!!

lee111s

I can't help with the loan calculations, you need to speak to the company and request them to provide a breakdown of the calculation that shows the amount of interest to be paid.

catota

I'm planning to do that, I was just hoping someone could tell me whether I'm right so I can approach them knowledgably

TrickyDicky101

Howdy

At 29.8% APR your monthly payments would be £37.65 not £48.87. Have they included some form of PPI in this (not even sure if that is still allowed?) or some other charge(s)?

Incidentally, I calculate your APR (based on £48.87 payments for 36 months) as being 59.25%.

CLAPTON

catota wrote: »

Hi everyone, hope someone can advise:
I bought a bed from dreams on hp but think they have calculated the final total wrong.
Cost of bed: £930
Term of loan: 36 months
APR: 29.8%
Monthly instalments: £48.87
Total amount payable: £1759.32

I appreciate that I may have got this wrong but I believed interest was calculated every year on the remaining debt. I have used nearly every APR calculator online and my total always comes up at around the £1420 mark. I have phoned customer services twice but they are unable to help as no one knows how to calculate the total using the APR. One did attempt she calculated 29.8% of 930 and x 3 to get total interest. Is this right? Hope someone can clarify. Thank you

firstly no 930 x 29.8% x 3 is clearly wrong as you are paying some of the capital off each month


and yes the interest ought to be about 1,400






what paperwork do you have ?


did you have any payment free months at the beginning of the loan?

catota

Thank you both, I have the receipt and the loan agreement, I didn't take out any xtras like payment protection and there are no xtra fees. It actually states that the interest charge will be £ 829.32 in total

Foxy-Stoat_3

catota wrote: »

Thank you both, I have the receipt and the loan agreement, I didn't take out any xtras like payment protection and there are no xtra fees. It actually states that the interest charge will be £ 829.32 in total

Problem solved then. The total interest was stated in the credit agreement you accepted and signed.

The time for questioning figures was before you signed it. If it was less than 2 weeks ago you maybe able to cancel the agreement and find another bed shop.

catota

Hp payment began 12 months after the purchase on the date set by them and I have not missed a payment. It was a buy now pay later, would that effect the interest?

Foxy-Stoat_3

Arrrr, "buy now, START paying for it later but we will charge you interest from the day of purchase" scheme.

Your interest sounds spot on.