A business regularly extends credit to customers for large purchases with a standard interest rate of 5 percent. There is also a $200 installment fee that is added to the total cost of the purchase. The customer signs the paperwork but returns the next day saying that the installment fee is too high. Does the customer still have to pay it?

Question

Responses

Yes, the customer has signed a contract.

No, customers have the right to reject unreasonable fees.

No, the customer is always right so the business should adjust.

Yes, the business has the right to charge whatever it wants for credit.

Answer 1

The most accurate response in this situation is:

Yes, the customer has signed a contract.

When the customer signs the paperwork, they agree to the terms and conditions outlined in the contract, which includes the installment fee. Therefore, unless the fee is deemed illegal or not compliant with regulatory standards, the customer is generally obligated to pay it.