Additional interest charged on settlement

Jonathan_Kelvin

I’m after opinions on this, please.

I bought a new car last month, and as I wanted it before selling another I financed part of it.

I asked the salesperson if there was any penalty or charge for settling early and was given a clear (but verbal) reply that there was not.

I requested a settlement figure today, 29 days later, and was given a figure with an extra £600 tacked on, which is a couple of months accruing at the APR, on top of what has already accrued.

I’m a bit annoyed, £600 is not to be sniffed at, and the person who agreed the loan with me in the showroom said that there’d be no penalty, so does anyone think there’s much chance of having the extra waived if I complain?

I work in Finance myself, and for good reason we record every phone call, so “misunderstandings” can be cleared up, but of course there’s nothing similar in this case to check that my memory is crystal clear and correct.

I’d like the deal that we discussed to be honoured, but have little interest in spending weeks or months arguing for it.

Caz3121

what is in the paperwork you signed re early settlement?

BoGoF

Normal early settlement provisions is 2 months interest. The answer is in your loan agreement not what you were verbally told.

BoGoF

And the finance company do not employ the car salesman so what he told you is not binding on them.

Jonathan_Kelvin

BoGoF wrote: »

And the finance company do not employ the car salesman so what he told you is not binding on them.

That’s not correct, he is acting as their agent, not as an introducer.

Bermonia

Whatever is stipulated on your loan agreement is what is correct and binding... regardless of what you believe someone may or may not have told you I’m afraid

BoGoF

Jonathan_Kelvin wrote: »

That’s not correct, he is acting as their agent, not as an introducer.

Either way, you signed the loan agreement agreeing to the terms and conditions.

There may be a way round the issue depending how the finance company deal with overpayments. With some lenders you can make a lump sum overpayment leaving a small balance. Any additional interest for early settlement is then calculated on the reduced figure.

foxy-stoat

Jonathan_Kelvin wrote: »

That’s not correct, he is acting as their agent, not as an introducer.

I suspect if you pushed this point the salesperson will say it is not a penalty or they will deny it, the 2 months interest on early settlement would of been stated on the agreement.

If you asked a mortgage broker the same question who are regulated and they told you one thing but the agreement stated another which you signed, I doubt you will get anywhere either.

£300 interest a month is a lot, what is the APR and loan amount?