Early Settlement Figure for Laptop loan too much? HFC Bank - Pc World

[rickydaprince]

Hi all.

 

I'm going to apologise first of all if I've posted this in the wrong place. It took me a while to put this new thread together so please offer any help you can, it would be greatly appreciated

 

Situation:

I have a Personal Loan for a laptop with the HFC bank taken out 29th Feb 2008 (Date of Agreement) bought from PC World. I have asked for an early settlement figure and they sent me a letter quoting the final amount required to settle the account. Let me summarise the loan details below:

 

Loan Summary

-Date of Agreement: 29/02/2008

-Settlement Date: 19/04/2010

-Amount borrowed: £399

-Opening Annual rate of Interest: 26.16%

-Duration of Agreement: 48 months

-PPI: No

-Monthly Repayments: £13.52 p/m

-Total charge for credit: Total amount payable over 48mths - Actual amount borrowed = (48*13.52) - £399 = £249.96

 

Don't know the APR, but it appears there were no "set up" fees or anything. So we can assume APR = 26.16% right?

 

I have now paid 25 months of finance already. After requesting an early settlement figure, I was quoted £265.25 based on the Consumer Credit (Early Settlement) Regulations 2004. The breakdown is as follows:

 

HFC settlement letter:

Total amount Payable (before rebate): £325.91

Rebate for settlement of account by the Settlement Date above: £60.66

Therefore, amount required to settle this account: £265.25

 

Query:

It seemed a bit too much.

Now I did the calculations for myself using the formula (which can be found here http://www.opsi.gov.uk/SI/si2004/20041483.htm):

 

 

 

 

 

 

• where:
  

• A1 = 399
  

• B1 = 13.52
  
• 
  r = 1.955378/100
  

• m = 1
  

• n = 25
  

• a1 = 25
  

• b1 = 24
  

• b2 = 23
  

• ...
  

• b24 = 1
  

• b25 = 0
  

After plugging these figures into the above formula, we get:

399*(1.01955378^25) - (13.52*(1.01955378^24) + 13.52*(1.01955378^23) + .... 13.52*(1.01955378^1) + 13.52*(1.01955378^0))

 

I did the right hand side part of this calculation on Excel and it didn't take too long (Word version of it is attached, since .xls is not allowed)

 

= 647.48 - 430.59

= £216.89 = Early Settlement Figure.

 

I understand that things aren't always accurate down to the last penny, but for the difference to be nearly £50 using the same formula I just had to question it.

 

Can someone please advise me if I have valid grounds, based on my calculations, to ask them to lower the settlement figure? Or are my figures totally wrong? Thank you for your time, it is greatly appreciated.

Edited March 30, 2010 by rickydaprince

[unfoundfuture]

ask them you've got nothing to lose, show them your calculation and ask them why theirs differs

[dx100uk]

dont know how they do it

but hfc are renound for very high early settlement figures.

 

in one letter i have from them regarding an ongoing battle with them they state they are 'entitled' to add a 'portion' of the 'lost' interest they would have gotten to the early settlement figure.

 

and ofcourse they refer to their ever changing 't&C's' which they claim is industry regulated so are correct

 

i hate hfc!!!!!

 

dx