Voluntary Termination of car finance and fair wear and tear

roz84

Hi guys, this is my first post to MSE so please be nice!!

I have had my car for a couple of years but due to being pregnant and needing a bigger car, want to do a voluntary termination on my aggreement. Now times were better when I got the car but to be honest, I just can't afford it any more. Part ex is not an option as my partner's mum kindly gave us her old car which has been a great help.

My question is this: I have confirmed with my finance company (Volkswagen Finance) that I am eligible to do a voluntary termination, providing that I pay £75 arrears and that the car is in a satisfactory condition - But just what does count as fair wear and tear?? I should mention that the car in question is a 7 year old renault clio, so nothing special at all, although it is taxed and mot'd. There aren't any dents or major scratches beyond what you'd expect of a car of this age, but I know that the brakes need doing and there is a problem with the driveshaft which i simply cannot afford to get fixed, should I risk the finance company taking it as it is and what would be the likelihood of me being charged for any repairs, considering the car's age?

On a related note, I THINK there is a PPI policy attached to my finance agreement, which I definitely didn't ask for at the time of purchase - would I be likely to be able to claim a refund in this?

Any advice will be very gratefully received!

immoral_angeluk

You could certainly attempt to reclaim the PPI if you didn't ask for it, wouldn't be able to claim on it...
As for the voluntary termination they will do an inspection and then charge accordingly for any damage or work that needs doing, if the brakes would fail an MOT I'd imagine you would be liable for the cost of those, also if the driveshaft is affecting the running condition of the car, plus any cosmetic details like dents, scratches etc.

PNPSUKNET

I would say yes to the driveshaft as its a major part of the car, the breaks you could get away with

katz*

Hi,

After being made redundant at the start of the year and finding a new job almost 4 months later at a very much lower salary, I could no longer afford to keep a car on finance as I have other credit agreements that I can not get out of, so am doing my best to manage everything on a much lowere budget.

After a lot of trawling through figures, I came to the conclusion that the financed car had to go and I would get the best cash-purchase car I could. I contacted the finance company before doing anything and they advised to do a Voluntary Termination.

I scraped some cash together once I got my first salary and managed to get another car which should keep me going for the next 3-4 years - I need a car to get to and from work as no public transaport is available.

I contacted the finance Co again and arranged to return the car to an auctioneers at their request (30 miles from home in Northampton). The car was briefly inspected (10 mins max) when I took it to them. I contacted the finance company by phone the next day, as agreed to confirm that this had been done.

I've sent the V5 form off to DVLA and switched my insurance to the other car.

2 weeks later, and Ive now received a letter from them stating that after inspection in Manchester, the car was in poor condition and requires nearly £1200 worth of work to bring it to an acceptable standard.

This was a 7 year old Clio with nothing more than tiny scuffs - definitely not scratches that go through the paintwork (from branches etc) to the bodywork - exactly what I would expect as normal wear and tear on a car of that age. There was a tiny hole in the carpet on the drivers side - probably from where the heel of my shoe has worn through over time when resting over the clutch. They're after around £500 for repairs/repainting for the scratches and nearly £600 to replace the entire carpet. Plus interior cleaning where there's some 'soiling' to the seats (probably from my dog), but I did clean it thoroughly inside before taking it to the actioneers.

Apart from the fact that a T-Cut should resolve the bodywork issues and I could probably carpet my entire 24 foot lounge for £600, can I challenge this at all?

They've taken 2 weeks to notify me of this, and the car is now some 170+ miles away, so hardly accessable for me to check that what they're saying is true.

I accept that there was a small hole in the carpet and that there were minor scuffs, not scratches and dents, but the car was in good condition as would be expected for a 7 year old car, not poor condition as they're stated.

Bottom line - I have not got the money for this and cannot afford to maintain the finance. Where do I go from here?

standupguy

katz* wrote: »

Hi,

After being made redundant at the start of the year and finding a new job almost 4 months later at a very much lower salary, I could no longer afford to keep a car on finance as I have other credit agreements that I can not get out of, so am doing my best to manage everything on a much lowere budget.


I am wondering which Finance co this as some will be worse than others at trying to blag more money out of you and will know they are on shaky ground when it comes to enforcement if you will not pay willingly?

They will not do any of this work on a 7 year old Clio - they will simply sell it at auction as it is.

They try and mitigate their losses by trying to get more money if the car has been neglected.

First thing to do is tell them you dispute what they are saying and need to see a full line by line breakdown of issues and costs.

Next, tell them you want your own independent engineer to check the car - you may find they have already disposed of the car at auction

If it is still there can you or someone inspect it again, there may be knocks made after you returned the car

Marks and scratches on a seven year old car are to be expected and they certainly should not claim for new carpets to be fitted to a seven year old car.

Put simply they are trying it on in the expectation that you will agree some amount even if less than they are asking - as any from you now is extra profit - or less loss - as far as they are concerned.

Do not accept what they are saying and fight them all the way

katz*

The agreement is with Marsh Finance.

I feel reassured now that I'm not the only one that think's this is totally unjustified work on a 7 year old car

jonjamie1970

I have some experience in these matters, some good some bad and I have succesfully returned 3 cars over the last 10 years on VT after paying half the amount owed. I too now currently run a £800 banger for the time being.

My question is , What paperwork did you sign and did they give you after the inspection ?

katz*

It was a sheet with mileage, noted issues (ticks, notes etc) - it's at home and I'm at work, so speaking from memory. I believe I signed this, but would have to dig it out to check.

At my insistence, they gave me the bit of the V5 I needed to return to DVLA to confirm when the registered keeper had changed.

I did this the following morning, along with the tax disc, that one of the people I'd spoken to at the finance Co had advised me to remove as he said they couldn't sell a car at auction with tax on it, so I may as well beneft from the refund.

jonjamie1970

I would have a check through and see what you signed for, if the carpet hole and the paintwork are not noted then I cant see what grounds they have. I went round my cars with the assesors who were always happy, (I usually valeted the car to a high standard to flumox them :rotfl:)

If you have just signed and he pointed out the marks on the sheet then you need to read the small print of your agreement.

Cash the tax in asap as you will lose another month if it gets to the DVLA later than Friday this week due to the bank holiday, you only get full months refund. :beer:

katz*

The tax was returned the day after I delivered the car to the Finance Co's nominated auctioneer. so I should at least get that back.

As the auctioneer was their nominee, I believe this makes them their Agent in the eyes of the law, from my long-distant BTEC business studies and my previous work in the (LOL, motor) insurance brokerage industry?

If the auctioneer was acting as their agent, would that would give me stronger grounds to dispute this now?

Am back home now, so able to check wordings etc.

The form I signed at the auctioneer's was a Vehicle Condition Report. This was done in daylight and stated as such. There are notes re dents, scuffs, chips and scratches nto the bodywork. However, the girl who did the check did not check inside other than to get the odometer reading, so there is no mention of a hole in the carpet (although I know it was present) nor any soiling to seat bases that are mentioned on the latest Vehicle Inspection Report attached to the letter I have from Marsh.

Additionally, the mileage noted when I returned the car on 07 May, against that now noted, was some 144 miles lower, so there is surely a high possibility that some of this damage could have occured 'on their watch' so to speak?

I have checked my agreement and this states under clause 14.1 Your right to end the Principal Agreement:
a) you may end the Principal Agreement by taking the steps set out in the notice 'termination: your rights' shown over the page. You must then (at your own expense) return the goods to us and, in the case of a motor vehicle, the registration document, tax disc and MOT certificate. You must also pay us any further amount mentioned in the notice.

There is no 'over the page' page present with the agreement.

That is pretty ambiguous, as 'any further amount' could construe anything they try to dream up and surely must be challengeable?

I'm trying to word a letter to them at the moment and would be very grateful for advice.

Whilst I think it may be reasonable to put some mats in the car (eBay set of 4 mats 99P on a Buy Now with free postage); clean the interior / exterior (most local hand car wash facilities do this for £20 ish) and T-Cut the paintwork (about £5.00 plus 1 hrs labour), would it be reasonable to put that forward as an acceptable amount to me (this would be £51.00 based on the hrly rate they quote)? Or should I steer clear of making any sort of offer and just say that it's unjustified to undertake £1200 of cosmetic work when there is no realistic chance of achieving anything like this differenetial at auction over the car in it's present condition?

I don't think having the vehicle checked over by my own independant person is viable (I don't know anyone in the area it now appears to be); have no way of checking if the vehicle's already been sold at aution so this would just be an attempt to extract more money from me under false pretenses; or indeed, if the vehicle is still within their custody and control, verifying that any such work would actually be carried out before selling at auction.

Perhaps I shouldn't have been so naive before returning it to them. But I had so much else going on (and still do) that I took their word at face value when I contacted them.

Hindsight eh....

standupguy

katz* wrote: »

The form I signed at the auctioneer's was a Vehicle Condition Report. This was done in daylight and stated as such. There are notes re dents, scuffs, chips and scratches nto the bodywork.


You are dealing with a smaller Finance company who lend their own money.

The half rule in the cca act was there originally to give some protection to lenders but over the years with low deposits and extended repayment periods coupled with higher depreciation on cars this has worked in the customers favour giving them a get out from negative equity.

Alas it means that in the majority of vt's the lender faces a loss. With your lender being smaller they can make the time to try and chase customers for additional monies due to condition of vehicle and try and get some more cash to offset their losses or as may be in your case, got a figure for the losses after sale of car and want to match it to what they think they can extract from you.

Write back saying: -

You are entitled to rely on the condition report at time of surrender of vehicle and this is commensurate with condition of a vehicle of that age -you need to tell them that.

You can point out the car has substantial mileage following surrender.

Tell them that you fully reject and dispute any further monies being payable and if they persist then you intend to report the company to the Office of Fair Trading informing them that in your opinion they are not fit and proper persons to hold a consumer credit licence illustrated by the actions they are taking to extract unjustified and unreasonable charges.

From their point of view they just want to mitigate their losses and some customers they write to will pay some or all.

However, if you stand firm they will back down, they would not want to put their consumer credit licence at risk and they will know they are being unfair and unreasonable.