Can anyone tell me what this is please....
My friend took out a HP agreement/loan on a Car 3 years ago, the Car cost £4,995, in the first 3 months he lost his job so missed around 3 paymets i think, after that he got another job and the payments have been regular and on time ever since..though he never managed to catch up the missed ones.
He now wants to trade the car in against a newer model and was initially accepted for finance with a different lender subject to his settlement figure, which he estimated would be arond £2,000 max.
When he was given the figure it's still £5,000 he has received in the post today a written statement of his account and has noticed they have charged him £61 each month Capitalization fee, and £100 in the first month before he missed any payments,
He has an appointment with CAB. tomorrow so hopefully they can help, but i just wondered if anyone here had any idea what these fees are, is it interest because he is still behind with his payments, and if so is this legal.