Mileage charges on contract car

Sterowley

Hi,
I bought a car on finance with VW in 2015, which had an annual mileage limit. However I was told that if I handed the car back before my contract ended (either exchange or give the car back and walk away) then the mileage limit would not apply and I would not incur any additional charge. However after speaking to them today, they tell me that according to an FCA change, this no longer stands and I am liable to the additional mileage charges. Please can you confirm if this is the case and if it applies to contracts taken out before the change was made.

Thanks in advance

motorguy

Sterowley wrote: »

Hi,
I bought a car on finance with VW in 2015, which had an annual mileage limit. However I was told that if I handed the car back before my contract ended (either exchange or give the car back and walk away) then the mileage limit would not apply and I would not incur any additional charge. However after speaking to them today, they tell me that according to an FCA change, this no longer stands and I am liable to the additional mileage charges. Please can you confirm if this is the case and if it applies to contracts taken out before the change was made.

Thanks in advance

If its a PCP deal there is no "FCA change" relating to this, however finance companies will pursue you for the excess with various levels of threats, etc. If you're thick skinned you can probably sit it out as it will never get to court, however they will persist.

What mileage were you contracted for, and what miles have you done?

spiro

The issue of mileage charges when you hand the car back before the end of the term has not been resolved. On the BBC the other week it was said this will only be sorted out after a case ends up in court. The loan companies are claiming mileage falls under fair wear and tear which they can charge you for.
If you could get away with it everyone would get a car on 5k miles pa, drive 15k pa and hand the car back early.

motorguy

spiro wrote: »

The issue of mileage charges when you hand the car back before the end of the term has not been resolved. On the BBC the other week it was said this will only be sorted out after a case ends up in court. The loan companies are claiming mileage falls under fair wear and tear which they can charge you for.
If you could get away with it everyone would get a car on 5k miles pa, drive 15k pa and hand the car back early.

Was that Captain Obvious they were interviewing?

However its no coincidence that the finance companies HAVENT taken it to court in the 30+ years PCP deals have been in existence.

They wont win it and they know it.

Whilst mileage may impact wear and tear (which they can charge for) they cant simply apply a pence per mile rate and say that there is a linear relationship to wear and tear.

There are guidelines that they follow by BVRLA. Mileage isnt even in the guidelines.

neilmcl

motorguy wrote: »

Was that Captain Obvious they were interviewing?

However its no coincidence that the finance companies HAVENT taken it to court in the 30+ years PCP deals have been in existence.

They wont win it and they know it.

Whilst mileage may impact wear and tear (which they can charge for) they cant simply apply a pence per mile rate and say that there is a linear relationship to wear and tear.

There are guidelines that they follow by BVRLA. Mileage isnt even in the guidelines.

To be more accurate nobody, the finance companies nor customers have taken this as far as a higher court for a decision that'll form precedent. We don't really know if or how many times the finance co. have taken action in a county court, although evidence posted online would suggest they generally don't get that far.

Sterowley

Thanks for the info, when I took the finance out in 2015 VW said it can be handed back after half way through the term and mileage wouldn’t matter but when I spoke to them today they told me of this FCA change that can apply to old T&C’s. I have done about 9000 extra miles than contracted at this stage which is 6p a mile extra. Of course I wouldn’t have done this if I was told about this apparent FCA change!

motorguy

neilmcl wrote: »

To be more accurate nobody, the finance companies nor customers have taken this as far as a higher court for a decision that'll form precedent. We don't really know if or how many times the finance co. have taken action in a county court, although evidence posted online would suggest they generally don't get that far.

Why would a customer take it to court? You dont go to court to stop people trying to claim money off you.

They postulate heavily and make threats but never take it to court because they know its unwinable. Anyone who has paid has done so because they didnt know better or they just gave in to the pressure.

motorguy

Sterowley wrote: »

Thanks for the info, when I took the finance out in 2015 VW said it can be handed back after half way through the term and mileage wouldn’t matter but when I spoke to them today they told me of this FCA change that can apply to old T&C’s. I have done about 9000 extra miles than contracted at this stage which is 6p a mile extra. Of course I wouldn’t have done this if I was told about this apparent FCA change!

Be aware

(a) its not half way through the agreement, its once 50% has been paid. This will be much closer to the end of term than 50%.
(b) there will be specific figures in your PCP agreement talking about your rights to Voluntary Terminate and the 50% marker and amount.
(c) You need to have not missed ANY payments or late payments because that can nullify your right to VT
(d) There is no FCA change - its a rouse to get you to pay.
(e) Did i mention that there is no FCA change?

DO NOT SIGN any paperwork relating to a voluntary termination as it usually includes weasel wording giving them explicit rights to pursue you for excess mileage.

neilmcl

motorguy wrote: »

Why would a customer take it to court? You dont go to court to stop people trying to claim money off you.

They postulate heavily and make threats but never take it to court because they know its unwinable. Anyone who has paid has done so because they didnt know better or they just gave in to the pressure.

But you could take it to Appeal an earlier decision, I did say "higher courts" after all.

motorguy

neilmcl wrote: »

But you could take it to Appeal an earlier decision, I did say "higher courts" after all.

But there'll never be a court case that you'll have lost in the first place because the finance companies have never taken it to court.

neilmcl

motorguy wrote: »

But there'll never be a court case that you'll have lost in the first place because the finance companies have never taken it to court.

Again, how would you know?

Yes, I agree that the evidence online, or lack off may suggest this is this case but it certainly isn't definitive.