Rent To Own Calculation...
Was looking @ the add posted by a company ..
the site mentions about owning a car for as low as 2500 for a brand new car..
assuming the value of civic is QAR 70,000
i have done a simple calculation below;
RENT to OWN Calculation
2500 x 48 months = 120,000.
Actual value of car = 70,000.
Difference or extra your paying 50,000...(A)
now if you would taken a bank loan, then calculation is as below
cost of car 70,0000
interest 7% pa
loan period 48 months
month installment 1,676.24 per month, so
1,676.24 x 48 = 80,450
Difference or extra your paying 10,450...(B)
now difference between (A) and (B) is 39,540
hhhmmm... think carefully before you go into such deals...
Statistical estimations of the likely election results from opinion polls also involve algorithmic calculations, but provide results made up of ranges of possibilities rather than exact answers.-Tax Tiger
the revised rate and methodology... u end up paying 30k extra.. i m just comparing the figures.. so u are saying that u are ok if some1 would like to take 30k extra (in this example)from any1 who is unable to get a loan from banks...? not acceptable at this rate.... surrounding countries charge 3.5% to 5.5%, unlike here...
Zuzo, I agree with XceptionalGreat, there are other figures you have not taken into consideration.
On the loan amount in the first year there is a charge. I think for me, my car in 2008 was Qrs.93,000.00 i had to pay Qr.2,500/- straight off which was included in the bank loan, Also there is insurance charge on the bank loan.
I took the loan from HSBC, when I checked my emi i found that a little less than half of my emi was towards bank charges.
Also, another think is that these private companies that provide a lease to own are in business so of course their charges are going to include their profit.
So, if you take a bank loan, it will be cheaper. Also, get a bank vehicle loan rep. to work out what it will cost you to buy a vehicle via their bank. All banks have various hidden charges.
All the best.
I have Civic Exi 2008, EMI 1346, 72 Months + Mainenance + Insurance. Car Value 73000+ interest for 6 yrs 23912.
Company's loan option is for those who cannot get a loan in the bank. That's why the interest is higher. If you can get a loan in the bank, no need to pay monthly installment of QAR2500 for civic.
In this case it's better to rent civic for QAR1800-1900 a month.
how did you arrive at 39,540 difference? i guess your formula with excel is not correct... did you subtract 10,450 from 50,000? please check your formula to arrive at 39,540 difference because 10 is missing... :
39,550 should be the answer...
you said it right. they are thieves. and there are many people who fall in to their traps. i have stopped myself many people fall in to their ads. u will end up paying almost 50% extra of actual car value
...like what do we have add... its a simple excel calculation done... if you know how to use excel.. please feed these values into the formula...pmt() in excel..
RATE= 7%/12
NPER= 48,
PV = 70,000
i cannot think of any other charges here... and if i have missed something, please be more specific... dont be vague in giving a comment..and by discarding what do you mean...?? you cannot close the deal before the agreed time and to these companies also u provide Post dated cheques so how can you escape the legalities...???
Thanks for your calculation
Firstly, your Car Loan Bank Interest Calculation is not correct..as you need to add so many other chargres while calculating EMIs.
Of course there is a difference in Rent to Own deals & Bank Loan, but Rent to Own gives you the freedom to discard the Car anytime without any financial liability,, which you can't do in case of Bank Loan.
Bunch of thieves. There must be some kind of regulatory body to check these frauds.