Cooling off period on Car Finance

dangtfc

Ok, I've been mighty foolish here but please give me your thoughts cause I'm locking horns with a car dealer over this at the minute and it is giving me no end of stress.....

I went to a car dealership last night and agreed to buy a used car (£4700), I was paying the whole amount on finance (less a £99 deposit) over 5 years. The monthly repayment worked out at £110p/m (£6600 over 60 months), eager to get the car and get on with matters, I signed the agreement to purchase the car and also the finance agreement.

On the drive home I was thinking about what I'd done and had that terrible feeling of remorse. "Could I have got a better deal online? I'm sure I've seen better deals online...".

So I rang the dealer back and told him I wanted him to hold fire on the finance because I wanted to have a look online at what else was out there. He was (understandably I guess) miffed by my decision. I assured him I fully intend on buying the car still but just want to re-assess my payment method. I told him I'd check at home and ring him in the morning to discuss it.

I got home and found that a loan of £5000 worked out at £99p/m (£5900 over 60 months) so this would be a MUCH better option.

I rang the dealer again this morning and told him what I'd found, he said he would have to check with the finance company exactly what the status of my credit application was, i.e. could they cancel the agreement before it was being processed.

I was arguing with him that there is a 'cooling off' period (in which I can cancel the loan) but he said that it does not apply. Upon trawling the net this morning it seems that he is right. However I have had a loan in the past whereby I received the funds in my account but changed my mind and remitted the fund back to them with no penalty.

Sorry for the long commentary but I wanted to give as much information as possible!!!

CLAPTON

what sort of loan is it HP or simply a personal loan or what?

maybe you just get a better loan and pay this one off ... may cost you a month or so interest depending on the type of loan

but there is no cooling off period as you signed in on his premises

dangtfc

The one I signed on-site, a personal loan.

If I pay it off immediately what sort of financial penalty can I expect to pay or does it vary massively from loan to loan?

As I say I've found a £5k loan for less than the £4.7k loan so if I pay take both out and pay off the £4.7k immy I may not lose out too much...

tupperware

dangtfc wrote: »

The one I signed on-site, a personal loan.

If I pay it off immediately what sort of financial penalty can I expect to pay or does it vary massively from loan to loan?

As I say I've found a £5k loan for less than the £4.7k loan so if I pay take both out and pay off the £4.7k immy I may not lose out too much...

Do you mind if I ask who the finance is through?

If you only signed the documentation yesterday evening it is very unlikely the finance company will have process and paid out on the agreement. Did you provide a DL or other form of proof of ID at all?

I know from personal experience that i've seen customers phone the finance company directly (speak with the motor new business team) and advise them that they do not wish the finance to be paid out on and the finance company will honour this. I have no idea on the legalities/etiquette of doing something like that though.

dangtfc

Thanks tupperware for that info, I will bear it in mind.

The finance at the garage is through GE Money. The finance I found online is through Moneyback Bank (part of Alliance & Leicester I believe).

They took photocopies of my drivers license and credit card signature strip....

tupperware

That will mean they have everything it takes to get the finance paid out.

I would phone GE Money directly and explain that you no longer want to take the finance and see if they will cancel payout of the documents. Worth a shot and i'm sure they wouldn't do anything illegal.

montypython_3

Just before you go cancelling anything have you actually applied and had the offer from moneyback bank agreed?

If you look at there online quotation it does state £5000 over 60 months at £99 a month at there headline rate of 7.6%APR

However it also states further down that to get this APR you must borrow a min of £7500.

What will your actual quote at your APR be not their typical APR??

oldagetraveller

If you have a copy of the finance agreement - you should have been given this- then have you checked to see what or if it says anything about cancellation or a possible "cooling off" period?
I would have thought a reputable dealer would be able to help you because you still want to buy their car. They and/or the salesperson are going to lose out on the finance commission though

dangtfc

Just to give some feedback on what happened here:

I contacted GE money directly, as tupperware suggested, and they immediately cancelled the application for finance with no quarms. So that was all sorted. I then called the dealer (who had told me he was chasing 'his guy' at GE Money 'to see if they could somehow stop the application') to tell him I had cancelled it without any problems.

Thinking that everything was now in order, I asked about paying the final balance for the car (£4601; they already had a £99 deposit) and he said he'd get back to me.

Lo and behold he rang me back asking me to pay £5000 for the car on the basis that the price of £4700 was only valid if we took their finance. This was a blatant lie so I went into the showroom the following day.

Things got more bizarre at this stage, the invoice I had signed to agree to the works scheduled on the car (Service Check & M.O.T.) as well as agree to my personal details, had been altered after I signed it!!! It now read as if I had signed for a car that was £5000! Incredulous, we challenged it and he admitted that the price had been altered AFTER I'd signed it. Quite amazing really.

Lots of "this is my bottom price" from the dealer ensued and he finally agreed to sell the car for the original price we had secured days earlier. With the M.O.T. still to check, I have a feeling this saga might not yet be over.......

Thanks anyway to everyone who posted in here, your expertise has proved invaluable in my first car purchase :-)

tupperware

dangtfc wrote: »

Just to give some feedback on what happened here:

I contacted GE money directly, as tupperware suggested, and they immediately cancelled the application for finance with no quarms. So that was all sorted. I then called the dealer (who had told me he was chasing 'his guy' at GE Money 'to see if they could somehow stop the application') to tell him I had cancelled it without any problems.

Thinking that everything was now in order, I asked about paying the final balance for the car (£4601; they already had a £99 deposit) and he said he'd get back to me.

Lo and behold he rang me back asking me to pay £5000 for the car on the basis that the price of £4700 was only valid if we took their finance. This was a blatant lie so I went into the showroom the following day.

Things got more bizarre at this stage, the invoice I had signed to agree to the works scheduled on the car (Service Check & M.O.T.) as well as agree to my personal details, had been altered after I signed it!!! It now read as if I had signed for a car that was £5000! Incredulous, we challenged it and he admitted that the price had been altered AFTER I'd signed it. Quite amazing really.

Lots of "this is my bottom price" from the dealer ensued and he finally agreed to sell the car for the original price we had secured days earlier. With the M.O.T. still to check, I have a feeling this saga might not yet be over.......

Thanks anyway to everyone who posted in here, your expertise has proved invaluable in my first car purchase :-)

Glad you got the situation resolved and well done on not being pushed around by the dealer. Can be a lot harder than people would think. :T