Can lenders take over £3.5k out of our bank with no notice?!!

dunstonh

Anyhoo, he bought his instructing car under a lease agreement with Ford where you pay an up front fee, pay a monthly repayment for 2yrs then as far as we thought, at the end of that 2yrs we either traded it in for a new car (sensible for an instructor!) or pay off the remaining amount due which we knew was around the £3k mark.

The finance agreement would show the payments and the bubble payment at the end. The direct debit instruction is set up to take the monthly payments and the balloon payment at the end unless told otherwise. So, from a transaction point of view, there has been absolutely no error or wrong doing.

What has potentially failed is that the letter informing you that the option is coming up has not been received. That doesnt mean it wasnt sent. It means you never got it. However, AFAIA, the option to buy a new vehicle instead is not one that is regulated.

You made a mistake by forgetting that the final payment would be the balloon payment. You knew the time was coming but you ignored it. Effectively you assumed you would be told and left it at that. It was an incorrect assumption.

And does anyone know where we might stand in keeping the car

Pay them the money you owe and you get to keep it or you do the trade in and move to a new vehicle.

faithcecilia

aimingforadebtfreelife wrote: »

Unfortunately it sounds from prev experience with these sorts of agreements its correct in the way when you look at it more closely. At the end of the day they want you to keep the car as more cost effective and profitable to them. So its worded 24 x payments of £XXX and 1 payment of £XXXX. It will mention about contacting Ford for options if you dont want to pay the final sum. They wont write to you as they want the payment ideally and dont want to put ideas in your head!!

Actually its the other way round, they would much rather the vehicle was handed back and a new one bought on finance again. This vehicle would then be sold by Ford Direct at a much higher price than the final payment, they would get more money from the new one, plus of course the extra registration which means more to them than the money.

redpete

notfunnymoney wrote: »

My main point was, are they allowed to just take a lump sum out of your bank without any prior notice of how much they're taking and what date they'll be taking it cos I'm sure that they're not - regardless of whether we owe it or not!!

They are almost certainly not allowed to do that but as had already been pointed out (without narky comments) the original agreement might well have made it clear how much, when and under what circumstances they would take a final payment.

Although other replies were not as diplomatic as they could have been it is good advice to keep any complaints to a factual basis; if you resort to accusations, rants and demands that could be invalid or unjustified you are less likely to get a sympathetic hearing if they do have any leaway in how strictly they enforce any agreement.

jonjamie1970

These "balloon" type payments are always the last payment in an agreement, if you read through the agreement you signed then they will always take this as a last payment on the last DD day of the agreement. Unless you speak with them prior and tell them you are trading in the vehicle to which point the dealer will settle this for you or you agree to hand the car park in the halfs and thirds ruling.

Malky

notfunnymoney wrote: »

as far as we thought....

You need to clarify this before we can help further
What you thought and what you actually signed up for are two entirely different things.

Clive_Woody

notfunnymoney wrote: »

My main point was, are they allowed to just take a lump sum out of your bank without any prior notice of how much they're taking and what date they'll be taking it cos I'm sure that they're not - regardless of whether we owe it or not!!

If the exact amount of this final payment was specified in the contract you signed then yes they are allowed to take it without further notice.

If the amount of this payment was not pre-defined (variable amount) and was paid by direct debit then they are required to give you notice of the amount and date when it would be taken. Check out the direct debit guarentee for details.