Settling The Bill With The Finance Company After Car Theft

[craigt3365]

The 2.89% is just a way to mislead the public ---- a marketing ploy.

The real interest rate is closer to 5.5 or 6 per cent, if it is calculated properly.

You are absolutely right. I was quoted 2.5% on my Honda paperwork. The banks says the same, and then says 4.75 Effective Rate (is that APR??). B.S. Same crap was done in the US until that law requiring APR to be listed.

People, it's flat rate interest. It's not by default a 'scam', nor a rip-off, nor misleading - in fact flat rate is the original easy-to-understand interest calculation method. APR was invented by banks, for the banks, so they could get the bulk of their interest repayments earlier in the loan term rather than having to wait for it. Nothing more, nothing less. Thailand's spin on this is to only give 50% discount on the remaining interest when paying out early. Do the math.. it's all pretty similar.

If you want to make comparsons, google will point you to any number of calculators that can compare flat rate to APR. The fact is, the MLR (min. loan rate) in Thailand is currently 5.85% and the the MRR (min. retail rate) is 6.45% so the 'flat rate' deals you're getting on car finance at 0.85% to the high 2%'s are still very good deals, no matter how you cut it.

Also, don't forget that the first rate you'll be offered by a salesman is always the worst. Negotiate it <deleted>

Well, that's something I didn't know. I thought if you paid off the loan you did NOT have to pay any future interest. Here, they still get you for 50%. Well, luckily at this rate, keeping the loan until it matures is not too bad...I can make more on my money elsewhere anyway...but I did not really understand this. Thanks for the clarification!

[Thaihog]

We specifically asked for coverage higher than 80% on our new car...the manager at the Honda dealer said no way. 80% was the max. Maybe that is with their insurance company only????

I upped the insurance from 80 to 90% on my wife's new honda jazz. I didn't like the idea of loosing 20% driving out of the showroom. I only paid an extra 1,800 baht, well worth it for the piece of mind.

[katabeachbum]

The 2.89% is just a way to mislead the public ---- a marketing ploy.

The real interest rate is closer to 5.5 or 6 per cent, if it is calculated properly.

You are absolutely right. I was quoted 2.5% on my Honda paperwork. The banks says the same, and then says 4.75 Effective Rate (is that APR??). B.S. Same crap was done in the US until that law requiring APR to be listed.

People, it's flat rate interest. It's not by default a 'scam', nor a rip-off, nor misleading - in fact flat rate is the original easy-to-understand interest calculation method. APR was invented by banks, for the banks, so they could get the bulk of their interest repayments earlier in the loan term rather than having to wait for it. Nothing more, nothing less. Thailand's spin on this is to only give 50% discount on the remaining interest when paying out early. Do the math.. it's all pretty similar.

If you want to make comparsons, google will point you to any number of calculators that can compare flat rate to APR. The fact is, the MLR (min. loan rate) in Thailand is currently 5.85% and the the MRR (min. retail rate) is 6.45% so the 'flat rate' deals you're getting on car finance at 0.85% to the high 2%'s are still very good deals, no matter how you cut it.

Also, don't forget that the first rate you'll be offered by a salesman is always the worst. Negotiate it <deleted>

Tiscos interet on new cars is presently 4,41%, so when dealer offers 0,85-2,85% the difference is payed by manufactorer/dealer. The od thing is there is no way to get this "discount" on a cash deal. Its a separte marketing budget to cover finance costs.

[frtiz]

Short update.

Nissan Leasing send us the calculations etc etcetera and promised to transfer the money on the 25th of June. No money then, now still nothing... We've tried to contact them for days in a row. and finally after 3 hours of waiting on the phone my wife got to talk them yesterday, that is two morning classes plus lunch and well into the 5th period in the afternoon and she got through to them. Then of course after the standard verbal abuse from the fine ladies at Nissan Leasing we were told that the calculations haven't been finalized yet. HOW on earth can they send us a bill if they haven't finished it and how long should it take? How many thousands of people work at the company?? Empty promises again. Now they said they are going to wire it on the 15th of July. The mrs is going down there today or tomorrow. This whole thing is costing us a lot of money. We have to pay interest over a loan we got from the bank, they're keeping our money and receiving interest over that, and we have spent over 1500 baht on phone costs over the last months plus my wife has to take a day off teaching to get these animals to work.

Just a reminder to everyone here at TV: Don't ever get involved with these monkeys.

[basjke]

Short update.

Nissan Leasing send us the calculations etc etcetera and promised to transfer the money on the 25th of June. No money then, now still nothing... We've tried to contact them for days in a row. and finally after 3 hours of waiting on the phone my wife got to talk them yesterday, that is two morning classes plus lunch and well into the 5th period in the afternoon and she got through to them. Then of course after the standard verbal abuse from the fine ladies at Nissan Leasing we were told that the calculations haven't been finalized yet. HOW on earth can they send us a bill if they haven't finished it and how long should it take? How many thousands of people work at the company?? Empty promises again. Now they said they are going to wire it on the 15th of July. The mrs is going down there today or tomorrow. This whole thing is costing us a lot of money. We have to pay interest over a loan we got from the bank, they're keeping our money and receiving interest over that, and we have spent over 1500 baht on phone costs over the last months plus my wife has to take a day off teaching to get these animals to work.

Just a reminder to everyone here at TV: Don't ever get involved with these monkeys.

Sorry to hear mate but you must have very strong balls.If this was me they would have enjoyed a visit of me on the 25th already and believe me I would leave the office with the money or a check in hand that very same day.

[aussiebebe]

Wow, what an ordeal - I'm lost for words!

In a sense you're right. However, not everyone who's buying a car is aware of this nor capable of doing the math.

Most people with 5 years of schooling will have no problem calculating flat rate interest in their head, or worst, on a napkin, but I'd openly challenge 99% of the population to tell me how much they owe on APR finance at a given point within their loan term, without resorting to google or excel

First off, sympathies to the OP, that is a real ordeal. Hope you get through it okay. I can only imagine. If you can, though, be patient and try not to shoot the messengers! Try to go to the top.

about the finance issue, I think APR helps people choose between loans when presented with options.As to interest at a given point, if it's a fixed rate loan (hire-purchase) with fixed installments you could think about the interest in different ways. You could think that either 1) you pay xbaht per month interest and xbaht towards the capital 2) you pay decreasing amounts of interest every month until the end of the loan or 3) all your installments for a certain period go towards interest and then you repay the capital. ie. a 30 year mortgage at 6% means that everything you pay for the first 15 years is interest. The end result of all these ways of thinking is the same, as the installments are fixed from the onset.

What's happening to the OP is that the finance company are manipulating the interest on the remaining balance and offering this 50% deal. The issue is whether this was in the original contract.

Edited July 2, 2010 by aussiebebe

[Pnow]

Isnt the finance company the beneficiary on the insurance records?