Car loan company charging daily interest on deferred payments

[nickib847]

What is the name of your state (only U.S. law)? IL

We just found out that our car loan company is charging us $4000 for interest on 6 deferred payment over the course of our 6 year loan. They are claiming to charge .25% daily on the deferred payments. Not one person at this company informed me of this when I deferred these payments or at any other time that we have talked to them. We were never informed of any daily interest on the deferred payments. Now they are demanding payment in full on this interest and are threatening to repossess the car even though we basically have it paid off, we only owe 3 more payments. Can they legally do this?

 

[golftrub]

What is the name of your state (only U.S. law)? IL

We just found out that our car loan company is charging us $4000 for interest on 6 deferred payment over the course of our 6 year loan. They are claiming to charge .25% daily on the deferred payments. Not one person at this company informed me of this when I deferred these payments or at any other time that we have talked to them. We were never informed of any daily interest on the deferred payments. Now they are demanding payment in full on this interest and are threatening to repossess the car even though we basically have it paid off, we only owe 3 more payments. Can they legally do this?

Sounds legal to me. Of course you have to pay interest on deferred payments. Did you think they were giving you an interest free loan on the deferred payments? And daily interest? You always pay daily interest on the entire loan. How do you think interest is calculated? They figure it out to the day.

 

[nickib847]

Yes we did expect to pay interest on it, however we were not aware that they would charge 25% daily on the account. That is almost more interest than we have paid on almost the entire loan. I did verify at the time of deferring if there were additional charges that I would be accruing & they flat out told me no, that there was a one time charge of $35 for deferring it. It would just extend the loan out the extra months. We did not expect to have it deferred as interest free, but we did not expect nor informed that we would have to pay 25% extra interest daily on those deferred payments.