Prescribed terms - clarification help please

[fallenangel]

I am looking at a copy of an HP agreement and I am trying to get my head round whether the terms stated are accurate. (Secretley hoping PT or some other knowledgable person may show up and turn the light on for me)

So the term of the agreement is 50 months, with 48 payments. Except there are 49 payments or are there 48 payments. Now you must be as confused as me.

I will try and clarify;

Amount of credit is shown all ok
APR shown - verdict out
Total amount payable all ok
Payment Amount £495
Number of payments 48
Frequency Monthly


Period of Hire: 50 months starting on the date of this agreement. Payment schedule: The first payment will be made 2 months after the date you take delivery of vehicle, with subsequent payments due monthly thereafter. The administration fee of £180 will be taken 1 month after the date you take delivery.

In addition, a final payment of £0.00 will be due 48 months after the first payment. An option to purchase fee of £95.00 will be payable at the same time if you choose to purchase the vehicle.



So are the prescribed terms accurate?
How many payments are there 47, 48 or 49

because .......

if the first payment starts 2 months after the date of the agreement (delivery of vehicle) and a final payment of £0.00 is due 48 months after the first payment then to my calculations that is actually only 47 regular monthly payments plus the admin payment at the beginning making the 48.

BUT...

Does it mean 48 regular payments. Plus the admin payment. And if so why does state "in addition the final payment of £0.00 due on the 48th month?

SO...

Should the agreement be written to state the final payment of £495 or is it sufficient to state as written above that there are 48 payments with a monthly amount of £495 irrespective that there has been an admin fee paid on month 1? and does the "in addition" part to the final payment refer to something extra that has not been charged and therefore accurate to state the final payment is £0.00?

I will post the agreement up shortly

In my mind, for it to state "in addition, a final payment of £0.00 will be due 48 months after the first payment" implies that the first payment being the regular instalment amount of £495 is payble each month upto month 48 where the final payment is £0.00 but am I wrong ??

As if I read it another way it could perhaps be referring to additional payment on top of the last payment of £495 (although not mentioned) and that the additional payment is for £0.00

Your comments greatly appreciated.

[Amethyst]

Re: Prescribed terms - clarification help please

Hiya,

I think it might be a bit clearer once you get the agreement posted up as yes it does sound a little confusing.

Also, as I don't think you have said, what is the current situation with the agreement ?

Ame
xx

[fallenangel]

Re: Prescribed terms - clarification help please

As soon as I get back home later tis afternoon I will post it up.

It is a current agreement.

[Amethyst]

Re: Prescribed terms - clarification help please

If you type in the figures for the initial loan, the APR, total credit / total cost of credit etc it will help too.

[Caspar]

Re: Prescribed terms - clarification help please

Hi Fallenangel,

In my poinion from the information you give it all seems OK to me, as per example below:

Say you took the agreement out in November, so

Payment 1 Jan
Payment 13 Jan
Payment 25 Jan
Payment 37 Jan
Payment 48 Dec

= 48 payments

In addition , a final payment will be due 48 months after the first payment = Jan - seems fine to be.

[Guest]

Re: Prescribed terms - clarification help please

Hi

Yes the APR figure is quite important, as it wiil indicate if the charges are contained in the total charge for credit or not.

Peter

[fallenangel]

Re: Prescribed terms - clarification help please

Sorry guys had trouble uploading - waiting for the loan of scanner so will do it shortly.

I appreciate all your comments.

But I will add this ignore all the figs for the time being except the wording on the agreement.

The term is for 50 months.

the wording is written exactly as follows;

Period of hire: 50 months.

The first payment will be due 2 months after the date you take delivery of the vehicle. In addition, a final payment of £0.00 will be due 48 months after the first payment.

Remember there is also the inital payment due one month after in respect of admin fee.

Ergo my question how many payments should there be?

I think its wrong to say there are 48 payments but in addition (just to confuse you there is) an extra payment of £0.00 which will be taken on the 48th month.

Should it not be better to state a payment of £495 plus option fee if applicable is payable 48 months after the first.

There is no mention or reference of what an additional payment would or could relate to.


Out of interest my partners HP agreement states the first payment will be taken 1 month after the commencement of the agreement with a final payment of xx due 48 months after the first payment becomes due.

His agreement is clear with no room for interpretation of confusion as to how many payments there are.


Number of payments are 48

Amount of payment is 495
------------------------------- merged -------------------------------

Hi

Yes the APR figure is quite important, as it wiil indicate if the charges are contained in the total charge for credit or not.

Peter

Hi Peter

Can you please explain what you mean. How does the APR indicate this?

[fallenangel]

Re: Prescribed terms - clarification help please

Hi Fallenangel,

In my poinion from the information you give it all seems OK to me, as per example below:

Say you took the agreement out in November, so

Payment 1 Jan
Payment 13 Jan
Payment 25 Jan
Payment 37 Jan
Payment 48 Dec

= 48 payments

Ok yes, so far so good! the 48th payment as you have demonstrated falls Dec but what is the amount for??

In addition , a final payment will be due 48 months after the first payment = Jan - seems fine to be.

Are you saying here the 48 month additionally payment is due Jan? if so that now makes the 49th month.

[Caspar]

Re: Prescribed terms - clarification help please

I suspect what Peter is saying is you need to match up the APR with the total amount of credit to make sure they tally. A case recently was won purely because of this issue.

[Guest]

Re: Prescribed terms - clarification help please

Sorry guys had trouble uploading - waiting for the loan of scanner so will do it shortly.

I appreciate all your comments.

But I will add this ignore all the figs for the time being except the wording on the agreement.

The term is for 50 months.

the wording is written exactly as follows;

Period of hire: 50 months.

The first payment will be due 2 months after the date you take delivery of the vehicle. In addition, a final payment of £0.00 will be due 48 months after the first payment.

Remember there is also the inital payment due one month after in respect of admin fee.

Ergo my question how many payments should there be?

I think its wrong to say there are 48 payments but in addition (just to confuse you there is) an extra payment of £0.00 which will be taken on the 48th month.

Should it not be better to state a payment of £495 plus option fee if applicable is payable 48 months after the first.

There is no mention or reference of what an additional payment would or could relate to.


Out of interest my partners HP agreement states the first payment will be taken 1 month after the commencement of the agreement with a final payment of xx due 48 months after the first payment becomes due.

His agreement is clear with no room for interpretation of confusion as to how many payments there are.


Number of payments are 48

Amount of payment is 495
------------------------------- merged -------------------------------


Hi Peter

Can you please explain what you mean. How does the APR indicate this?

Yes

THe APR is a product of the Total Charge for Credit, the Total Credit and the total repayments.

The fee or any charge that you paid in order to get the vehicle must be contained within the total charge for credit,(section 9 of the act) if it is not then the agreement may be unenforceable because the total credit figure would be incorrect(WIlson).

If the charge is contained within the total credit instead of the TCC the APR will be Lower than it should be.

See here for further info

http://www.legalbeagles.info/forums/...ad.php?t=23763
Peter

[Guest]

Re: Prescribed terms - clarification help please

Sorry guys had trouble uploading - waiting for the loan of scanner so will do it shortly.

I appreciate all your comments.

But I will add this ignore all the figs for the time being except the wording on the agreement.

The term is for 50 months.

the wording is written exactly as follows;

Period of hire: 50 months.

The first payment will be due 2 months after the date you take delivery of the vehicle. In addition, a final payment of £0.00 will be due 48 months after the first payment.

Remember there is also the inital payment due one month after in respect of admin fee.

Ergo my question how many payments should there be?

I think its wrong to say there are 48 payments but in addition (just to confuse you there is) an extra payment of £0.00 which will be taken on the 48th month.

Should it not be better to state a payment of £495 plus option fee if applicable is payable 48 months after the first.

There is no mention or reference of what an additional payment would or could relate to.


Out of interest my partners HP agreement states the first payment will be taken 1 month after the commencement of the agreement with a final payment of xx due 48 months after the first payment becomes due.

His agreement is clear with no room for interpretation of confusion as to how many payments there are.


Number of payments are 48

Amount of payment is 495
------------------------------- merged -------------------------------


Hi Peter

Can you please explain what you mean. How does the APR indicate this?

HI Again
Just looking at your orriginal question.
Seems to me that there are 48 payments over a 50 month period. the last payment would be for 495,does this add up with the puchase price?

The aditional payment i think reffers to an additional sum usually the optional puchase fee which used to be aded to the last payment, if this is a recent agreement this fee is no longer required so they would have probably had to addapt the existing agreement and make the figure 0.

Peter

[fallenangel]

Re: Prescribed terms - clarification help please

Hi Peter

Thanks again. i understand what you said about the option to purchase fee being £0

But it actually says as I quoted "additionally, a final payment of £0.00 will be due 48 months after the first payment. An option to purchase fee of £95 will be payable at the same time as the final payment."

Therefore, as I read it, the first payment became payable in month 2 and the last payment due 48 months later is for £95 only assuming the option to purchase fee is payable. But if not then the final payment is £0.00

[Guest]

Re: Prescribed terms - clarification help please

HI

Yes or it could meam that an aditional payment of "0" is due at the same time as the 48th payment

It would be easier to decifer if we could see the full agreement with all the information on it.

Is the agreement dated after feb this year?
Peter

[Guest]

Re: Prescribed terms - clarification help please

yes makes sense

[Guest]

Re: Prescribed terms - clarification help please

Hi
yes sorry crossed posts , i am sure you are right. The agreement would have run for 50 months and then the purchase takes place the following month,

They changed the requirment forthe purchase fee in the consumer credit directive so now the car automaticaly becomes the property of the hirer on the last payment, not sure if this is retrospective though come to think of it. may be worth finding out may save you 95 quid.
Peter