working out agreement

[kirstycobie]

i'd be grateful if someone could quickly let me know how to work out Welcome Finance agreement, so i can see if there right with mine as i cant scan it up.

 

thanks

[beyondhope]

if you type in the figures someone can do it for you as in

 

total for credit XXXX (a)

 

sorry i cant work it out i havent a clue on aprs etc

[kirstycobie]

thanks;

 

figures below:

 

amount of credit for goods:4900

amount of cresit for insurance:1000

total amount of credit:5900

 

duration of agreement 48month

monthly payment £203.17

 

total amount payable 8351.84

total amount payable for insurances:1599.84

total amount payable 9951.68

 

APR 31.3%

 

--------------------------------------

 

other financial info

 

mech brakedown cover £650

shortfall extra insurance £350

 

 

PX allowance £100 (they told me they were giving me £1200, LIARS)

 

Aceptance fee £195

finance charges for goods:3056.84

option fee £100

charge for credit for goods:3351.84

charge for credit for insurance:599.84

total charge for credit: 3951.68

rate of interest on credit (per annum): 15%

 

id be grateful if some one could work this out for me thanks, ive tried typing info into a website calcul;ator and apparently its about £1000 to much what welcome are charging me.

[kirstycobie]

just bumping it up

[kirstycobie]

bumping again

[Et Contra Pacem Regis]

In this case you're lucky. Welcome Finance has used the "flat rate" method of calculating interest:

 

P * R * T = I

 

where P = Principle (amount borrowed), R = Rate, T = time and I = interest.

 

The trick here is the figure Welcome Finance has used as the principle. Your loan works out fine, if you assume:

P = 6095 (amounts of credit plus the acceptance fee)

R = 0.15 (15% expressed as a decimal)

T = 4 (48 months = 4 years)

therefore I = 3657

 

Now we work out the total amount payable:

6095 (the two amounts of credit and the acceptance fee) + 3657 = 9752

 

And the monthly payments:

9752/48 = £203.16' (6 recurring).

 

The difference in the Total Amount Payable is probably due to a very slight rounding of the interest rate.

 

And that is how your agreement has been worked out. Where that is an acceptable way for it to be worked out is a different matter. The charging of interest on the Acceptance Fee is an issue in a case called Walker v Southern Pacific Personal Loans, which will be heard by the Supreme Court in May.

 

Probably more important is what was agreed about the part exchange. If they've only given you £100 in px when you agreed £1200 that is a much simpler and more definate problem than the Walker point. The trouble is, do you have any way to prove it?

 

You could attempt to get documentation from Welcome by Subject Access Request, or from the dealership or broker if one was involved, that might turn up something, such as a quote with the real part exchange figure.

 

There is also, of course the PPI angle to consider.