early settlement fees not transparent

[haoKR]

Bike shops have been coming up innovative ways to make riders part with their money. This “Early Settlement Fee” is one of them.

In 2000 there wasn’t such a thing – in fact, when I paid off my bike back then with almost two years of installment left I INSISTED AND RECEIVED AN INTEREST REBATE.

 

In 2009 when I bought a bike, this loophole was effectively closed when along with the Hire Purchase Act which I had to sign, the bike shop insert an “Early Settlement Fee” agreement that I had to sign. Most buyers are too eager and probably thinking about their new rides to give much thought to the stack of papers the shops get you to sign. Little do they know that they have signed off most of their consumer rights, and given the bike shops pretty much free rein to penalize the buyer.

 

Months later when the want to early settle or sell off the bike independently the bike shops will gleefully rub their hands. Out comes the “Early Settlement Fee” or refinancing when you sell off the bike (more about refinancing further down).

 

A lot of people think the shops is financing the bike but that’s not really true – most loans the buyer takes are financed and fulfilled by financial institutions or banks. Bike shops make MORE money by charging you a HIGHER interest than what the bank or financial institution is charging them. Take a look at how cars are financed – both 1st hand and 2nd hand. The interest bike shops charge are ludicrous when you compare.

 

The problem is that we ALLOW the shops to take advantage of us. We don’t have a riders’ association or union that looks out for us.

When we start taking more personal and financial responsibility we can pressure the relevant parties, like the Singapore Motor Traders Association to do more for consumers/riders/buyers.

 

its the thing now, no one really look at the price tag of the bike now because 95% of the riders COI their bike

[MR BIKER]

I wish I can inculcate young riders to save up and enjoy their ride later on because first they are young and the urge is surely there. bikes , babes and such but having been there and done all that, I can understand when most riders just sign the dotted line especailly when you have the shop seller urgin you sign here, there , next page, , this , that until you dont know what you have already signed.

[Dominictsk]

In my true sense, I think that paying off a bike with its interest is sufficient.

 

Additional charges of "early settlement fee" is outrageous. What kind of loss do they sustain , in order to claim such a fee?

 

Very fortunate for me that no COI is involved.

 

Deal with a fair seller, not jump at the lowest price guys

[Orleng]

In my true sense, I think that paying off a bike with its interest is sufficient.

 

Additional charges of "early settlement fee" is outrageous. What kind of loss do they sustain , in order to claim such a fee?

 

Very fortunate for me that no COI is involved.

 

Deal with a fair seller, not jump at the lowest price guys

That is how they make the sales. Usually with low(er) "machine" prices (or "OTR" for 2nd hand) than other shops without early settlement. Buyer is attracted by low prices upfront. Doesn't factor in early settlement fee, when added, will probably be higher than other shops with slightly higher initial price, but no early settlement.

 

Down the road, when you decide to sell off, the early settlement comes out. Typically, they offer to waiver the early settlement fee if you push in your bike at a low price for a trade-in to take out another bike with them. So basically, unless you decide to bite down and hold on to the bike, or risk a COI arrangement till all instalments are cleared, you will wind up paying more than otherwise buying a bike from another shop with no such penalty, but with a slightly higher starting price.

[haoKR]

I wish I can inculcate young riders to save up and enjoy their ride later on because first they are young and the urge is surely there. bikes , babes and such but having been there and done all that, I can understand when most riders just sign the dotted line especailly when you have the shop seller urgin you sign here, there , next page, , this , that until you dont know what you have already signed.

 

young ma, can play jiu play,can take jiu take.

somemore its 100,200+ per month, they will think 'aiya,so cheap only'. then you will see them selling it 1/2 year later

[haoKR]

That is how they make the sales. Usually with low(er) "machine" prices (or "OTR" for 2nd hand) than other shops without early settlement. Buyer is attracted by low prices upfront. Doesn't factor in early settlement fee, when added, will probably be higher than other shops with slightly higher initial price, but no early settlement.

 

Down the road, when you decide to sell off, the early settlement comes out. Typically, they offer to waiver the early settlement fee if you push in your bike at a low price for a trade-in to take out another bike with them. So basically, unless you decide to bite down and hold on to the bike, or risk a COI arrangement till all instalments are cleared, you will wind up paying more than otherwise buying a bike from another shop with no such penalty, but with a slightly higher starting price.

 

but thats how they learn, if im the boss, i am more then happy to let COI

[dreamer_toons]

That is how they make the sales. Usually with low(er) "machine" prices (or "OTR" for 2nd hand) than other shops without early settlement. Buyer is attracted by low prices upfront. Doesn't factor in early settlement fee, when added, will probably be higher than other shops with slightly higher initial price, but no early settlement.

 

Down the road, when you decide to sell off, the early settlement comes out. Typically, they offer to waiver the early settlement fee if you push in your bike at a low price for a trade-in to take out another bike with them. So basically, unless you decide to bite down and hold on to the bike, or risk a COI arrangement till all instalments are cleared, you will wind up paying more than otherwise buying a bike from another shop with no such penalty, but with a slightly higher starting price.

 

 

This is very true.

 

Glad I read this thread before I visited several shops shopping for a new revo. Reminded myself not to get too excited over the new revo but ask questions, especially about the OTR prices and other hidden prices.

 

1 of the shops kept insisting that the early settlement fee was only few hundred dollars despite I ask about how the shop calculate this 'few hundred dollars'.

 

I left the shop and gave my business to another shop without this fee instead.

[flyingcow]

wow. $6804 alr include all interest on loan, on top of that have early settlement fees?? good business to offer COI man...

[tionghan]

i feel your pain TS.. $1300 is not a small amount consider your outstanding is 6k plus. .. almost 25% more u have to fork out.

[Adam1]

I can feel you man but most shop also have this already but sometimes no choice buy already ma. My friend kena $1800 before from other place but heng his motor last quite long never really fork out any maintenance $.

 

IMO if you feel that the motor condition is good its ok.

[guangwei]

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Edited April 1, 2015 by guangwei

[ST_Nepal]

I bought from As Phoon, as my fren's always bike and sell there. They do not have this Early settlementFee.

 

 

Sent from my iPad using Tapatalk

[ticks]

That's why some of them are driving sports cars!! Pisses me off. Living on other peoples hard earned cash!

 

Good thing I found planet motors to do my servicing. Irks me if I have to go back to the same shop to do servicing as well as installment.

 

anyway just a thought, not sure about other shops, these shops only allow cash payments when it comes to installment. Anybody want to give an idea why only cash?

[srini2411]

1300 is wicked, did you read through the contract yiu signed ? Greedy bike shops. Thank god this site exists to do direct sales without going to bike shops.

[JoshuaHuang]

omg.... omg.... omg,,,,

[Jehuty]

This shop is famous for their cutthroat ways, the finance coy im using have no early settlement fees, even have rebate if you settle early lol

[fnkwh]

experiencing the same issue here with my shop. left $282 x 38 months = $10,716.

was quoted $1,300 for early settlement.

so if want to settle early, gotta full cash $10,716 + $1,300 = $12,016.

 

i have yet to check the contract but it means either i mark up my selling price, or i ride for 3 more years.

kena knock by the shop! in future, do be careful when taking loans!

[filtered]

what a ripoff these ah beng/ah seng bike shops.......lol

 

You mark up your selling price, smart buyer will also know how to calculate how much its worth, and why should they be paying for the interest on your loan?

 

better u ride for 3 more yrs

[ST_Nepal]

I am paying 208 $ a month, 36 months installment, paid 1500$ as down payment and bought FZ16 on 18th April 2013. I am welcome to pay early settlement anytime. Even now n then i go to AS Phoon for minor repair or maintenance issues, very friendly and helpful mechanics.

[guangwei]

lol my post was deleted

[kingash1321]

Yep..ASPhoon doesn't have early settlement fees.. Bought my Spark there last year.. not bad service i guess

hoping to buy a S4 from them since passed 2A recently heh

[ST_Nepal]

Yes, i got my class 2A too. tempted to get S4 or CB400X, but still comfortable with my FZ16. If i decided to get, will get it from AS Phoon.

[736cc]

i think best is for biker to read before sign any document. buying bikes is not like buying HP or TV.

That why when i sell my bike, i always advise buyer to go bank if they need to loan and that is the best way out also less problem for me.

Edited June 5, 2015 by 736cc

[ticks]

Bank will give loan? But at higher percentage right?

[Jehuty]

Bank will give loan? But at higher percentage right?

 

Have to inquire them on vehicle loans, direct with finance coy oso good since you don't deal with the middle man eating up money aka 'Admin fees', its just a lil more troublesome.