un-regulated contract

gary_pacha

Morning All,

Someones help would be greatly appreciated on this matter to follow.

I bought a car from a dealer for the value of £40,990k, put a deposit down of £4,100k – loan agreement over 60 months. - £881.33 per month

The broker that got the loan agreement said because I never had the size of credit before that the APR would be high, I was happy with this as I was advised, by the broker that we would revisit the loan after 6 months and get the APR reduced (on hindsight this sounds stupid, I’ve been very naive and relied on the person for support), we never did revist the loan.

I have now decided to sell the car. To date I have paid £15,863.94 off a loan of £36,890. When I asked for a settlement, I was told I owe £37,075.86, and the loan is a un-regulated contract and was an arranged un-regulated contract to facilitate business usage, at that time.
However at the time when I asked the broker what he meant by business usage, he stated this was my business miles ie commuting to work. Im not a business and never been or had a business.

When I ask the loan provider for the APR they are unwilling to provide this to me, at the time of taking out the loan I was told 15.2%, but I can see this anywhere in the agreement.
I understand I have been silly / naïve, but this deal feels like it has been miss sold to me under false pretences.

Anyone’s help would be greatly appreciated – this isn’t a sad story, I’m selling the car for 2 reasons, 1- to part fund a wedding and 2- reduce my monthly outgoings so I can buy a house.

Tixy

The figures quoted do suggest that the initial APR was 15.2%.
As £36890 over 5 years at 15.2% is £881 per month.

Which would have been the total amount repayable of £52,490.

Have you got all the paperwork from when you made the purchase/ took out the finance?

gary_pacha

Thanks Tixy,

I agree, the monthly payment is inline with APR.

I dont understand why i would have paid off (said amount), yet still owe £37k.

Surely that could be less, i worked it out to be around £28k.

Whats your thoughts.

Tixy

If it was an agreement under the consumer credit act then you would be entitled to pay off early and would only pay an extra 56 days early settlement interest so then you would owe around the £29k mark after 18 payments.

As it is an unregulated business agreement they appear to have charged the whole of the interest upfront and are charging you the full amount of interest regardless of whether you pay off early.

As the MSE forums mostly deal with consumer credit you might want to try posting on the legalbeagles forum with details of the agreement as they may be better placed to advise on your options.

gary_pacha

thank you so much for your help, greatly appreciated

gary_pacha

how do i find the legalbeagles forum, thanks in advance

AndyT678

gary_pacha wrote: »

how do i find the legalbeagles forum, thanks in advance

Really?

https://www.google.co.uk/search?q=legalbeagles+forum&oq=legalbeagles+forum

bengal-stripe

gary_pacha wrote: »

how do i find the legalbeagles forum

Google is your friend!

http://www.legalbeagles.info/forums/

SeanG79

Unregulated finance agreements operate differently to regulated agreements. Interest is not front loaded, BUT the lender is entitled to charge you the FULL interest as if you had run the agreement to term. Usually there is a small rebate of interest but this is negligible.

gary_pacha

Apologies Andy - i assumed legal beagles was within the moneysaving expert website.

AndyT678

gary_pacha wrote: »

Apologies Andy - i assumed legal beagles was within the moneysaving expert website.

Ah! I understand the confusion now.