Hello. Good morning.. my boyfriend is really stressed about his car loan. First they told him that the car he want was 1,450,000 yen and upon signing the contract, the was worth 1,450,000 yen. But when the papers arrived, it now cost 1,970,000 yen and told that it was the interest of car. Is that normal? I mean, that huge interest?
Edit: Okay so it turns out that the loan car price was 1,450,000 yen and the remaining was for extra fees for the car. I don’t know but I really think that’s too much. Anyway, thank you for all of your responses. Have a good weekend.
16 comments
I have no idea when it comes to this that’s why I posted/asked here. Thank you.
I mean, how long is the loan and how high is the interest rate?
The whole point of loans is to make the banks money, so yeah, if the rate is high enough, that is totally possible.
Something doesn’t seem right. The car might be worth 1,450,000円 but having to pay a loan of 1,970,000円 is a 27% interest. That is an insane amount of interest. But depending on where the loan came from, how long, upfront deposit, and how much per payment, it is possible to get that high. Without more info it’s hard to tell.
My eyes glaze over thinking about this sort of thing.
Anyway, you’d need to know:
* The interest rate (presumably calculated on the remaining balance, but might not be).
* The repayment period.
* Periodic repayment amount.
These details would have presumably been on the finance agreement that he signed. The total amount should not have come as a surprise.
The final cost *feels* like a lot more, but may not be, considering the above; especially if it’s being repaid over a number of years.
In Japan interest rates are tiny, but they get you with other “fees”, interest on these fees, or other types of interest (beyond the most attractive interest rates they advertise in big letters – which may only be for the first year) or payment stipulations. It’s common – even the big dealers like Toyota, Honda etc.
It’s better to save up a few years driving old bangers around, and then pay in one lump sum.
If you must take a loan, you can haggle.
It depends on the interest rate and how long he pays for the loan.
Hard to say without seeing the paper. But the price on the tag is never what you are going to pay because of fees and taxes.
I doubt it’s a scam, but it’s hard to say
Does not sound unreasonable for a car loan. As other have said, the annual interest and period is what is decisive here.
There are probably things like the shaken (which dealers greatly overcharge for), the ownership certificate, the number plate, delivery, dealer fee, cleaning fee, loan insurance fee, etc in the total
Without seeing the document, there is no way to know if it’s only the interests that inflate the price by that much.
Look that the contract: All the details of the loan must be written there.
If it isn’t in there, then it’s not valid and you would possibly need to take legal actions against them.
They **cannot** change the details of a signed contract by themselves.
He would have to sign the new contract for it to be valid.
How old are you and your boyfriend? 18? 😂
Ask for a breakdown of the costs. Did they tell you the car price alone and now giving you the bill which also includes all on-road costs?
Not enough information. What’s the length of the loan and the rate of interest?
You can basically cancel a sales contract in the “cooling off period” (10 days?)
But if that’s a 10 year loan then it tracks for me. F.e. 3% per year or so.
I’ve seen dealerships take anywhere from 50,000 yen shaken to 289,xxx yen shaken.
Initialization setup cost, initial maintenance : 110,000 yen
Pre-inspection fee : 60,000 yen lol
Product recall : Free
Now, the problem is the company wasn’t upfront about the costs with him.
>worth 1,450,000 yen
Can you clarify if that’s the price of the car, or if it’s also including the registration and other fees?
>But when the papers arrived, it now cost 1,970,000 yen
It’s possible that it’s with the interest, but that really should have been explained at the time of the signing. Any time I’ve been looking at cars, we got the car price, total including fees, and total including interests of we were to take a loan. All of that had always been on paper and thoroughly explained. It would be pretty shitty if this was completely left out when you signed.
Also the loans at dealers usually have high interest, so if you do need a loan, it’s always best to check with banks if you can get a better deal.