Ridiculous vehicle interest rate

Theeproff

New Member
Joined
Aug 17, 2019
Messages
6
Hi everyone, I recently discovered that dealership charged me 18.6% interest for 73months. Bought the car in 2016July for R120.000. Any legal advise route I can take to get the contract revised? Your input will be highly appreciated
 

Tman*

Expert Member
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Jul 18, 2012
Messages
2,490
You willingly entered into a Contract, there is no basis to sue, you will look like an idiot
 

thechamp

Honorary Master
Joined
Feb 26, 2011
Messages
21,060
Maximum interest rates are linked to the South African repo rate
(Reserve Banks repurchase rate).

  • Home Loans = Repo rate times 2.2 plus 5%.
  • Credit cards, store cards, overdrafts, vehicle loans = repo rate times 2.2 plus 10%.

It looks like everything is above board OP, take it as a good lesson learn and pay careful attention next time.
 

airborne

Executive Member
Joined
Jul 13, 2007
Messages
9,460
Once the op has paid the R120k loan up how much interest would he have paid in total?
 

thechamp

Honorary Master
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Feb 26, 2011
Messages
21,060
I have asked a couple of colleagues how much interest they are paying on their cars, I have been met with blank stares on one or two occasions, it seems some people are just interested in monthly instalments.
 

WaxLyrical

Honorary Master
Joined
Oct 20, 2011
Messages
19,330
Hi everyone, I recently discovered that dealership charged me 18.6% interest for 73months. Bought the car in 2016July for R120.000. Any legal advise route I can take to get the contract revised? Your input will be highly appreciated
Ask them for a settlement figure.
 

The_Traveller

Expert Member
Joined
Aug 9, 2008
Messages
2,235
Take it as a lesson learnt and move on.

Now for any contract you sign no matter how small it is, you will read from beginning to the end,
 
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RedViking

Nord of the South
Joined
Feb 23, 2012
Messages
20,832
What is a good interest rate?

It might be that OP is also a high liability and was probably below 21 yo at the time? If it plays a role.... Bad credit record?
 

ShaunyCT

Senior Member
Joined
Jun 16, 2010
Messages
877
Hi everyone, I recently discovered that dealership charged me 18.6% interest for 73months. Bought the car in 2016July for R120.000. Any legal advise route I can take to get the contract revised? Your input will be highly appreciated
 

RonSwanson

Expert Member
Joined
May 21, 2018
Messages
1,106
I'm a good financial risk, always paid my bills even when retrenched. My credit score according to TymeCoach is 720. When I last bought a vehicle on HP (many many years ago), I received an initial quote of prime less .5%. I shopped around and pushed the finance houses and ended up getting prime less 1.5%. My home loans are also at prime less 1.5%.
It is all about risk, if you pay your bills regularly, you are rewarded. If you budget like a zuma you will skip payments, and you will be seen as a higher risk. Likewise with insurance, if you keep claiming, your risk profile increases and you will get higher premiums.
 

Johnatan56

Honorary Master
Joined
Aug 23, 2013
Messages
24,970
What is a good interest rate?

It might be that OP is also a high liability and was probably below 21 yo at the time? If it plays a role.... Bad credit record?
based on this: https://mybroadband.co.za/forum/threads/car-finance-interest-rates.948849/
14.5%.
701259
From: https://www.southafricanmi.com/average-interest-installment-2jan2019.html
Note yearly figures. No clue if OP means yearly or over the total payment duration.

Wesbank (FNB):
701261
Caps their calculator at 16.5%.
 
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