Mis-Sold Hire Purchase?

Micha26

I am in need of some advice....

Two and a half years ago I bought a car from a local garage. I had arranged my finance via a bank but the salesman convinced me to take out finance with them so I could have the car quicker.

At the time, I was wary so asked him whether it was HP that I was taking out-he advised me no and that I would be free to sell the car at any time as I would be taking out a loan rather than HP.

After having my first child, I have recently fallen into financial difficulty and wanted to sell my car but was advised by the finance company that this would not be possible as I signed a hire purchase agreement - I have only just noticed this (my fault I know) but I am very angry that I was lead to believe I would be taking out a loan and not HP......

I've now had to return the car to the finance company who auction the car at a tiny amount compared to if I had been able to sell the car privately...

I'm left feeling cross and taken advantage of - do I have any comeback?

CLAPTON

on an HP agreement you can hand back the car after half the deal has been paid.

Micha26

Yes, I have done this but they have advised me that I may still be liable for any shortfall... If I had gone with the original loan I could have sold the car privately and ensured that the sale price would settle the loan....

Can I complain to anyone about the mis-selling?

brightonman123

i think ypu coud still sell the car yourself. but the loan has to be repaid or the new 'owner' could lose out when the lenders come to repossess THEIR car!

CLAPTON

If you have paid half the HP deal then you can return the car without any further payments

see
http://www.direct.gov.uk/en/MoneyTaxAndBenefits/ManagingDebt/DebtsAndArrears/DG_10013226

I see no realistic chance of any complaint being unheld
It would be your word against the garage's and you say yourself that in 2 years you hadn't even read the agreement to realise it was HP rather than a loan.... surely its on the top of the loan agreement

In any event
-you have nothing to pay if you're made half the HP payments

- I can't comment on the loan/sale argument as you haven't said what the value of the car was or what you borrowed and what its settlement figure would have been

tupperware

The sale price of the car will be irrelevant.

You will be liable up to the half way point in the finance as detailed on your agreement.

It may be worth looking into paying that on a 0% credit card if you are not able to pay it off in one go.

Keep in mind if you agree to pay it off in reduced installments it will still affect your credit rating.

scotsgirl_3

Are you 100% sure it is actually a HP agreement?

I know this might sound obvious, but have a look at the contract - if it is HP it will actually say HP on it, and it will also detail your termination rights very clearly. It should say something like " this is a hire purchase agreememnt regulated by the consumer credit act......."

If the finance company are stating you will be liable for a shortfall, then there is a possibility that what you may have is a loan through the finance company for your specific vehicle. In this case you don't get the right to return when you have paid half, but the finance company would still register the vehicle details as on finance which would stop you selling it unless they removed this. In many cases the finance company will allow a voluntary surrender where they take it back, sell it at auction and you are responsible for the balance, which it sounds like they are discussing.

You need to double check - it could be the finance company getting it wrong, but it may not be.

Who is the finance with?

Micha26

Ok - the finance is with Black Horse & it definitely says Hire Purchase agreement at the top!

I thought that as long as the car makes what I still owe on the HP, I won't be liable for an more but am not sure if this correct... I'm sure the financecompany have said that if it doesn't make the amount remaining, I will be liable for the balance but this doesn't make complete sense in relation to some of the information given above...!

I'm guessing that I don't have a leg to stand on with regards complaining about mis-selling...?! :mad:

Clive_Woody

Micha26 wrote: »

Ok - the finance is with Black Horse & it definitely says Hire Purchase agreement at the top!

I thought that as long as the car makes what I still owe on the HP, I won't be liable for an more but am not sure if this correct... I'm sure the financecompany have said that if it doesn't make the amount remaining, I will be liable for the balance but this doesn't make complete sense in relation to some of the information given above...!

I'm guessing that I don't have a leg to stand on with regards complaining about mis-selling...?! :mad:

I am not being nasty, but if the paperwork says Hire Purchase Agreement at the top, and you signed this agreement, but it has taken you two years to realise this is a hire purchase agreement and not a loan then I suspect you will struggle to make a case for being mis-sold this finance.

scotsgirl_3

how much was the agreement for?

If it says hire purchase then you should have the right to hand it back once you have paid half and owe nothing - the exception being any arrears you may have and any fees outstanding. That's your right, end of.

There is one possible exception - if it was a high value, it may not be a regulated agreement. The limits for this have changed in recent years although I know at one stage it was 25k.

If it is under this then realistically you have probably just spoken to someone who doesn't understand the difference between Voluntary termination and Voluntary surrender. You should have had a form through to sign when you handed it back - have a look at that. Although the person you spoke to may not have known the score, those handling the sale and sorting out of your account will as it's a specialist department who deal with it.

P.s. used to work at BH so if I can be any more help just holler. I do suspect that you will struggle to make a case for being mis - sold though as it is pretty obvious on the agreements.

Micha26

Clive_Woody wrote: »

I am not being nasty, but if the paperwork says Hire Purchase Agreement at the top, and you signed this agreement, but it has taken you two years to realise this is a hire purchase agreement and not a loan then I suspect you will struggle to make a case for being mis-sold this finance.

I understand your point but why should these salesmen be allowed to lie, just to get you to sign the agreement? He gave me incorrect information, with the promise of an earlier pick up of the car, just so I took finance out with them.... To me that is unethical or am I alone there...?!