Shop Playing Punk. Penalty on Early Settlement

[mdradhi]

HI bros..

 

i want to do an early settlement to bike shop for my FBB Vtec III. But instead of reducing the interest (4%/yr) balance of 32mths instalments, they are going to charge me extra which they call 'The Early Settlement Penalty' ( never heard of this my whole life )

 

 

Currently total outstanding balance is at $7579.20 ( $236.85/mth ). I will have to pay $8079.20 for early settlement. This is a rip off. They're definately a bully.

 

I am not going to pay and i would like to get my unused interest back. i need some advise and help on how to overcome this case. Will writing in to Ministry of Finance help on this hire-purchase?

[redname]

  mdradhi said:

HI bros..

 

i want to do an early settlement to bike shop for my FBB Vtec III. But instead of reducing the interest (4%/yr) balance of 32mths instalments, they are going to charge me extra which they call 'The Early Settlement Penalty' ( never heard of this my whole life )

 

 

Currently total outstanding balance is at $7579.20 ( $236.85/mth ). I will have to pay $8079.20 for early settlement. This is a rip off. They're definately a bully.

 

I am not going to pay and i would like to get my unused interest back. i need some advise and help on how to overcome this case. Will writing in to Ministry of Finance help on this hire-purchase?

 

there are some contracts which states abt tis. do have a look at ur loan agreement 1st

[mdradhi]

redname - let me search for it. but do any bike shop doing this ?

[madman]

  mdradhi said:

redname - let me search for it. but do any bike shop doing this ?

 

in Bikers Inc magazine, A.S. Phoon P/L says no penalty for early settlement in their ad.

 

my advise is, if you dun mind, nego with them. Early settlement still wanna charge you extra is not right, cos the interest in the 1st place is not waived.

 

if paying the interest is ok with you, just tell them you pay all the outstanding installments one shot, interest already paid, so why would there be a penalty.

 

ask them if they prefer to get the same amount of money one shot, or in 32 months. i would choose to get all back then 200 a month.

[Guest NPNT]

read ur contract properly. some do state and ask for early settlement penalty.

[compfused]

Many shop charge early settlement fee..Its the amount that usually varies from shop to shop..

[bladeboy]

very common stuff so far onli heard A.S. Phoon no early settlement fee

[FW1314A]

alot of shop have this fee la, its not uncommon. -_-

[chuan.z]

as many mentioned, if it's in ur contract, suck thumb liao...

options:

1) pay up + early settlement fee (non-disputable if it's in black/white)

2) carry on installment $200+ per month

3) invest the $7.5K... given that Sg current prime lending rate is 5.38%, make ur 4% loan work for u!

[EK]

read the contract b4 signing on it

[contrarian]

If you've never heard of it, it's you who have not asked about it, or likely not read your hire purchase contract, before signing it. If that is the case, you shouldn't blame others, and most definitely not engage in name calling. Read your contract, and read the hire purchase act which allows for it, before you say more.

[effee]

TS quite new izzit, alot of shops all got early settlement fee

[BlackBandit]

Cheh!!!

 

Even my car got early settlement fee for the first 2 years. And it's with OCBC Bank, no less....

 

 

TS, read your contract. Usually, for early settlement, the interest is waived in place of the early settlement penalty. If not, you can pay the full amount including the interest for the whole hire purchase tenure. Which either way, you shouldn't be worse off...

[LollyPoP]

there's onli 1 shop in SG which i koe who will refund u yr interest if u intend to make early settlement. (pro-rated)

& tat shop is LOOIS' , no doubt his prices are not the cheapest in town but a 101% honest shop.

 

other shops? i rather would not comment.

u can try my style, pay all yr remaining installment (expect 1 last one).

there's nothing they can do, & tat's wat i did.

 

& remember to pay the last installment when it's due.

[FunkyChicken]

  LollyPoP said:

there's onli 1 shop in SG which i koe who will refund u yr interest if u intend to make early settlement. (pro-rated)

& tat shop is LOOIS' , no doubt his prices are not the cheapest in town but a 101% honest shop.

 

other shops? i rather would not comment.

u can try my style, pay all yr remaining installment (expect 1 last one).

there's nothing they can do, & tat's wat i did.

 

& remember to pay the last installment when it's due.

 

smart idea..never tot of that before. anyway which shop did u buy ur bike from mdradhi? most bike shops has early settlement.

[GuiNNeSS]

Most shops have early settlement penalty, same with some credit companies and bank loans.

 

I doubt you can get around it unless the shop is willing to waive the contract regulations.

[compfused]

  LollyPoP said:

there's onli 1 shop in SG which i koe who will refund u yr interest if u intend to make early settlement. (pro-rated)

& tat shop is LOOIS' , no doubt his prices are not the cheapest in town but a 101% honest shop.

 

other shops? i rather would not comment.

u can try my style, pay all yr remaining installment (expect 1 last one).

there's nothing they can do, & tat's wat i did.

 

& remember to pay the last installment when it's due.

True..I did the exact same thing..Just don't forget the last instalment..

[contrarian]

  ViciousKitty74 said:

Most shops have early settlement penalty, same with some credit companies and bank loans.

 

No, they're not "penalties", they're "fees". Penalties are not easy to enforce at law.

[Pplater]

  FunkyChicken said:

smart idea..never tot of that before. anyway which shop did u buy ur bike from mdradhi? most bike shops has early settlement.

 

if they reject, u can also open a savings account, put in all the money and giro link it to auto pay every month. One shot put the money in, no need bother liao. When loan pay finish, see if got a few bucks of interest extra not

 

TS, unless u trying to sell the bike off, then bo bian must eat the early settlement fee loh... if your loan contract does not have this provision, then u have a case to fight.

[hitman]

  Pplater said:

if they reject, u can also open a savings account, put in all the money and giro link it to auto pay every month. One shot put the money in, no need bother liao. When loan pay finish, see if got a few bucks of interest extra not

 

TS, unless u trying to sell the bike off, then bo bian must eat the early settlement fee loh... if your loan contract does not have this provision, then u have a case to fight.

 

paying installment by Giro?

[madman]

ya, can instruct the bank to deduct certain amt to a certain acct if you want. sort of like giro. but if you forget to cancel it when installment is paid, it will still deduct month after month, so be careful.

[LollyPoP]

  FunkyChicken said:

smart idea..never tot of that before. anyway which shop did u buy ur bike from mdradhi? most bike shops has early settlement.

 

my current bike is from Albert Motor.

Andrew neber say anything when i clear my installments in advance.

thinking of it, it's been a longgggggg time since i went to pay for my installment.

every mth go there see see look look, no bikes caught my eye yet.

[GuiNNeSS]

  contrarian said:

No, they're not "penalties", they're "fees". Penalties are not easy to enforce at law.

 

Really?!!!

 

Oh shucks.

[queirtus]

  LollyPoP said:

there's onli 1 shop in SG which i koe who will refund u yr interest if u intend to make early settlement. (pro-rated)

& tat shop is LOOIS' , no doubt his prices are not the cheapest in town but a 101% honest shop.

 

other shops? i rather would not comment.

u can try my style, pay all yr remaining installment (expect 1 last one).

there's nothing they can do, & tat's wat i did.

 

& remember to pay the last installment when it's due.

 

yup great idea thats wat my fren did to his KR, u pay all except last one then wait ah till the last one is due.

 

in a way they can't do anything coz ure just paying in advance.

[cyben76]

Most bike shop wil have early resettlement fee.. How much depends on the contract u sign.... but normally shops will twist the facts in the contract.. by right it suppose to be:

Example:

Installments every mth $100 left 12mths = $1200

Interest per annum 5%

So actually minus interest shld be $1200 - 5% = $960

Early settlment penalty of 2%

So if settle early must pay $960 + 2% = $979.20

 

But most bike shop themselves dont understand or try trick u.. They will say

$1200 + 2% = $1224

 

Actually early settlements penalty not only for bikes, also applies for car, personal loans and stuff... If they try to twist the words in contract, bring it to CASE..