Black Horse Agreement. What is the APR???

[sploits]

Hi,

 

I recently traded my old car in for another car and the difference was made up by a hire purchase agreement with Black Horse. I bought the car from my local Arnold Clark (which I bought my old car also). I bought it from a lad that I actually know. He told me the APR was going to be about 12% which I was happy and then told me I would be making 15 payments of £128.69 which I washappy with. I signed the paperwork and then picked up my car a few days later. I have been paying £128.69 since March this year which I have no problem paying. I was sorting out my paperwork last night and found my copy of the agreement and noticed that the APR states its at 40.5%. This wasn't what I agreed to. Also there is a lump sum payment of £426.69 to pay at the end of the hire purchase period.

I know I should have checked the paperwork fully but the guy is supposed to be a friend so I didnt think I would be getting fiddled on it. Is there anything I can do or should I just carry on with it? It isnt going to kill me paying everything they want I just feel a bit cheated as it wasnt what I agreed to

 

This is my copy of the agreement:

 

Any help would be great

 

P.S. If the images are too big I will edit and add links to the agreement

[Mossycat]

I've done a quick calculation and if you don't take into account the final payment you have been charged just under 12% interest, that is the flat rate, NOT the APR. (If you include the final payment your flat rate is just over 15% per annum)

 

So, when your friend told you it would be about 12% he was correct in one sense, that is the interest rate you have been charged, but it is not the APR.

 

Most garages quote a flat rate as it is easier to work out the payments, the APR (the true cost of borrowing which includes all charges, ie agreement fees, arrangement fees, final payments, document fees, etc) is always shown on the actual finance agreement, and since you have signed to say you accept it I don't really see what you can do about it now.

 

It would be your word against his, he would more than likely say he quoted and advised you of the flat rate, you would argue it was the APR, but if it went to Court they would have the agreement signed by you which clearly states the APR.

 

Mossy

[sploits]

Cheers for that Mossycat. I will just give him a slapping next time I see him

[Mossycat]

I'd be tempted to play the 'hurt friend' and tell him you feel cheated, you trusted him to look after you and took him at his word that it would be 12% APR, now you realise it's actually over 40% you feel cheated because that is extortionate for a loan.

 

See what he says to that

 

Mossy

[sploits]

I could try that. No doubt he would shrug his shoulders and say he thought he told me.

 

Never mind its my stupid fault for signing it without reading it fully. It wont happen again and I wont be getting a car from him in the future.

 

thanks for all your help Mossycat