Car Loan

happyoutish

I know this sounds crazy and I should have found out this before I took my loan out nearly two years ago: - I just spoke to the finance company whom I have my car loan with and they told me I was paying 12.66% interest! I nearly fell off my seat! Is this normal? My mortgage interest is lower then that!!!

I asked the girl could they do anything about the interest rate. And in a very unsavory tone I was told "you took the loan out and this is the rate there is nothing we can do about it" Think its time to change finance company! I told her i'd have to look somewhere else and she said that was fine just remember your loan will have to be paid off in full here first.

So my question really is has anyone been in this situation before and was it easy for them to switch to another finance company?

Thanks

PCPhoto

finance companies always have high interest rates ..... bit stupid to ask but why didnt you get a bank loan.

As I see it your only option at the moment is get a bank loan and pay the whole lot off (then pay off the bank loan) ...or pay the finance agreement off over the agreed length of time.

sorry for asking but did you read the terms and conditions (fine print) on the finance agreement ? did you ask them what the rate of interest was before agreeing ?

happyoutish

I know, I know, it was stupid. The dealer where I bought the car only did finance with this company (or so he said) so thats why I didn't get a bank loan. I suppose I was a bit "green" and just went with the flow. Honestly, no I did not ask about the interest rate, when I think back over it the whole thing was so rushed! Sign here, sign there, etc etc..

Its my own fault I know.. I just needed a new car badly. I don't have a problem paying the monthly rate or anything I just thought the interest rate was massive! Might have a chat with my bank.

Thanks for your reply PCPhoto

Jet Black

Mortgages usually are cheaper in rates than personal loans. Check with any bank and there loans would be a couple of percent higher than mortgage rates.

What you could do is clear the original loan and get a cheaper one. If its a fixed loan you would normally pay a fee usually 3 months of interest. If its varable its not charged. Check the agreement.

Check itsyourmoney.ie to compare interest rates.

voxpop

Standard loan rates from banks are usually around the 10% mark so its not that crazy an APR - though I have a creditcard with AIB that 8.5%. Your mortgage is always going to be a low APR because of the size and duration of the loan.

For example - AIB Personal Loan rates below, from their own website:


For loan amounts of EUR 25,000 or more 9.60%

EUR 20,000 up to EUR 24,999 10.10%

EUR 15,000 up to EUR 19,999 10.55%

EUR 10,000 up to EUR 14,999 11.35%

EUR 5,000 up to EUR 9,999 12.10%

EUR 2,500 up to EUR 4,999 13.65%

EUR 0 up to EUR 2,499 14.30%

happyoutish

voxpop wrote: »

Standard loan rates from banks are usually around the 10% mark so its not that crazy an APR - though I have a creditcard with AIB that 8.5%. Your mortgage is always going to be a low APR because of the size and duration of the loan.

For example - AIB Personal Loan rates below, from their own website:


For loan amounts of EUR 25,000 or more 9.60%

EUR 20,000 up to EUR 24,999 10.10%

EUR 15,000 up to EUR 19,999 10.55%

EUR 10,000 up to EUR 14,999 11.35%

EUR 5,000 up to EUR 9,999 12.10%

EUR 2,500 up to EUR 4,999 13.65%

EUR 0 up to EUR 2,499 14.30%

Looking at that the interest rate is still cheaper.. I would be in the €10,000 up to €14,999 @ 11.35%
I'll be giving my bank a call so

Thanks voxpop

Thanks to you to Jet Black

PCPhoto

happyoutish wrote: »

I know, I know, it was stupid. The dealer where I bought the car only did finance with this company (or so he said) so thats why I didn't get a bank loan. I suppose I was a bit "green" and just went with the flow. Honestly, no I did not ask about the interest rate, when I think back over it the whole thing was so rushed! Sign here, sign there, etc etc..

Its my own fault I know.. I just needed a new car badly. I don't have a problem paying the monthly rate or anything I just thought the interest rate was massive! Might have a chat with my bank.

Thanks for your reply PCPhoto

op ...how long ago did this happen - there is normally a 7 or 14 day cooling off period (unless you waivered the cooling off period - there might still be a way, but might involve solicitors)

happyoutish

PCPhoto wrote: »

op ...how long ago did this happen - there is normally a 7 or 14 day cooling off period (unless you waivered the cooling off period - there might still be a way, but might involve solicitors)

Nearly two years ago PCPhoto.. To be honest I didn't think the interest rate was that high then.. Can't really remember.. They have to notify you if they increase the interest rate don't they?

voxpop

They cant increase the rate once you have made the agreement

Jet Black

happyoutish wrote: »

Nearly two years ago PCPhoto.. To be honest I didn't think the interest rate was that high then.. Can't really remember.. They have to notify you if they increase the interest rate don't they?

If its a varable loan they dont. What you also have to take into consideration is 2years ago the interest rates would have been higher the economy was better. Some places have low loan rates. I think tesco still have a rate of 6.9% on all loans.

voxpop

Tesco dont do loans anymore - got a letter from them say that its all on Ulster Bank now (they were behind the tesco loans anyway). Interest rates will be higher now - as the banks dont want to lend. 2 Years ago everyone wanted to lend which lead to lower rates - ie Tescos 6.9%