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Carcraft/NAC 'warranty'.
Relliott6879
Posts: 20 Forumite
Hi guys, I'm after a little advice if you would be so kind. (I'm not sure if I'm posting this in the right area, so Forum moderators please feel free to re-locate as necessary)
In February 2008, I bought a car from CarCraft in Sheffield. I signed a 48 month finance agreement for the car (At 178.75 per month, with a £299 admin fee in the final month) which has been paid without event or problem. At the time of buying the car, however, the salesperson pretty much railroaded me into also signing up to a warranty which purported to cover pretty much anything up to a nuclear blast. As the car was primarily to used by my partner whilst I was working away in Germany (all declared on insurance and so on, so above board and legal), reliability was paramount so I went for it. The cost of the warranty was £38.12 per month over the same 48 month period as I was paying for the car. The warranty was with a company called NAC, which I have since found out is a child company of CarCraft themselves.
Only a few months after buying the car, it developed a problem (failed injector seals) so I attempted to claim on the warranty. NAC dismissed my claim as 'fair wear and tear' even though the garage I had taken the car to said there was no way a car of the age and mileage should suffer such a fault. I took this on the chin and coffed up for the repair.
Fast forward another few months, now around a year since I bought the car, the exhaust inlet manifold failed. Again, I tried to claim from NAC. This time, initially, they appeared to be playing ball. The stumbling block came when they asked me to send copies of the car's service history during my ownership. They wrote back very quickly to tell me that, when I had the car serviced, I had exceeded the manufacturer's recommended service intervals by just over 100 miles and the garage I had used was not VAT registered, this was in breach of the terms and conditions of the warranty and that meant that NAC would not consider this or any future claims.
I took this to mean that, admittedly due to my actions, the warranty was now null and void, so I called NAC to cancel the direct debit. The lady I spoke to informed me that I had signed a legally binding agreement and was obliged to carry on paying the premiums for the remainder of the 48 month term. I told her about the letter I had received (which I still have) and asked how I could be expected to pay for a service that NAC had stated in writing that I would not receive, I was not in posession of any tangible property, merely an agreement to fix the car which had now been declared void. The reply was that, at the time of the agreement, the entire cost of the warranty had been underwritten by a third party and was effectively a loan that I was repaying at £38.12 per month. If I did not continue the payments then I would be defaulting on a loan and the third party would be out of pocket.
Right or wrong, I disagreed with this and cancelled the direct debit anyway with my bank. NAC then proceeded to post a notice of late payment on my credit file every month from that point onwards. This continued until late last year, without NAC ever attempting to contact me. Out of the blue, I then got a phone call from a company called Clarity, who it would seem are a debt collection agency. The lady at Clarity explained that they were acting on behalf of NAC and that I should repay the outstanding monies to Clarity. I explained the whole situation to her and that I felt that I did not actually owe the money. She said she would speak to NAC and get back to me, which was the last I ever heard from Clarity.
Last night, I got a phone call from a company called Red Castle. The man who rang asked for me by name and then asked me to confirm the first line of my address 'for data protection purposes'. I refused, stating that I did not know who he was, that I had never heard of his company and did not know why he was calling. He replied that he had sent me a letter on Feb 28th but I told him that I had received no such letter (which I haven't). He asked me again for the first line of my address and again I refused, so he said that he would now have to stop ringing me and write to me instead, as his company needed to speak to me.
I'm thinking that Clarity, rather than liaising with NAC, have sold this 'debt' to Red Castle.
My question (sorry it's taken so long to get to the point!) is what to do now. I don't feel that I owe this money and, interestingly, no notices of late payment have been placed on my credit file since 1 Jan 2012, which would have been the due date for the final payment to NAC. I have been told by a couple of friends and colleagues that if I simply don't pay then the notices of late payment will be erased from my credit file after 6 years. This sounds a little too simplistic though, is this really the case? If so, do I merely ignore this 'debt' and - assuming I conduct my monetary affairs correctly in the interim - I will have a clean credit file as of February 2018?
I should add that around 18 months ago I approached both the Financial Ombudsman and the Citizen's Advice Bureau with this problem and they both said they were powerless to intervene as it appears that NAC are not FSA regulated.
Regards, Rich.
In February 2008, I bought a car from CarCraft in Sheffield. I signed a 48 month finance agreement for the car (At 178.75 per month, with a £299 admin fee in the final month) which has been paid without event or problem. At the time of buying the car, however, the salesperson pretty much railroaded me into also signing up to a warranty which purported to cover pretty much anything up to a nuclear blast. As the car was primarily to used by my partner whilst I was working away in Germany (all declared on insurance and so on, so above board and legal), reliability was paramount so I went for it. The cost of the warranty was £38.12 per month over the same 48 month period as I was paying for the car. The warranty was with a company called NAC, which I have since found out is a child company of CarCraft themselves.
Only a few months after buying the car, it developed a problem (failed injector seals) so I attempted to claim on the warranty. NAC dismissed my claim as 'fair wear and tear' even though the garage I had taken the car to said there was no way a car of the age and mileage should suffer such a fault. I took this on the chin and coffed up for the repair.
Fast forward another few months, now around a year since I bought the car, the exhaust inlet manifold failed. Again, I tried to claim from NAC. This time, initially, they appeared to be playing ball. The stumbling block came when they asked me to send copies of the car's service history during my ownership. They wrote back very quickly to tell me that, when I had the car serviced, I had exceeded the manufacturer's recommended service intervals by just over 100 miles and the garage I had used was not VAT registered, this was in breach of the terms and conditions of the warranty and that meant that NAC would not consider this or any future claims.
I took this to mean that, admittedly due to my actions, the warranty was now null and void, so I called NAC to cancel the direct debit. The lady I spoke to informed me that I had signed a legally binding agreement and was obliged to carry on paying the premiums for the remainder of the 48 month term. I told her about the letter I had received (which I still have) and asked how I could be expected to pay for a service that NAC had stated in writing that I would not receive, I was not in posession of any tangible property, merely an agreement to fix the car which had now been declared void. The reply was that, at the time of the agreement, the entire cost of the warranty had been underwritten by a third party and was effectively a loan that I was repaying at £38.12 per month. If I did not continue the payments then I would be defaulting on a loan and the third party would be out of pocket.
Right or wrong, I disagreed with this and cancelled the direct debit anyway with my bank. NAC then proceeded to post a notice of late payment on my credit file every month from that point onwards. This continued until late last year, without NAC ever attempting to contact me. Out of the blue, I then got a phone call from a company called Clarity, who it would seem are a debt collection agency. The lady at Clarity explained that they were acting on behalf of NAC and that I should repay the outstanding monies to Clarity. I explained the whole situation to her and that I felt that I did not actually owe the money. She said she would speak to NAC and get back to me, which was the last I ever heard from Clarity.
Last night, I got a phone call from a company called Red Castle. The man who rang asked for me by name and then asked me to confirm the first line of my address 'for data protection purposes'. I refused, stating that I did not know who he was, that I had never heard of his company and did not know why he was calling. He replied that he had sent me a letter on Feb 28th but I told him that I had received no such letter (which I haven't). He asked me again for the first line of my address and again I refused, so he said that he would now have to stop ringing me and write to me instead, as his company needed to speak to me.
I'm thinking that Clarity, rather than liaising with NAC, have sold this 'debt' to Red Castle.
My question (sorry it's taken so long to get to the point!) is what to do now. I don't feel that I owe this money and, interestingly, no notices of late payment have been placed on my credit file since 1 Jan 2012, which would have been the due date for the final payment to NAC. I have been told by a couple of friends and colleagues that if I simply don't pay then the notices of late payment will be erased from my credit file after 6 years. This sounds a little too simplistic though, is this really the case? If so, do I merely ignore this 'debt' and - assuming I conduct my monetary affairs correctly in the interim - I will have a clean credit file as of February 2018?
I should add that around 18 months ago I approached both the Financial Ombudsman and the Citizen's Advice Bureau with this problem and they both said they were powerless to intervene as it appears that NAC are not FSA regulated.
Regards, Rich.
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Comments
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You warranty was the same as your Insurance policy if you pay by DD.
The whole amount is due at the start (it's all paid for you but they recover over a period of time).
Of course a company like this has many scams and the fact that they are a related company is of no consequence, it just means they can fool a punter into paying a much higher premium than going through the hassle and grief of google.
Lots of people stop Insurance DD as soon as they sell the car, it sadly doesn't work like that.
The effect on your credit file will be for 6 years from the date of default. That 6 years will not even start until they default you. It is normal for the default to appear at around Month 8 of missed payments (the golden number on a credit file).
After 6 years from default, it will fall off and no longer appear.
This doesn't mean the money is no longer owed though. They can still drag you to Court for a CCJ before then which is a whole different problem for you.
You appear to be repaying less than £9k for a car from Carcraft, I don't recall ever seeing such a low figure for their finance. Even small, older cars end up well over £10k (as your may be with the Warranty fees).
Their "get out" clause which they have used is pretty standard for all warranties though, very common so this isn't particular to Carshaft.0 -
I've never noticed the word 'default' listed on my credit file (I subscribe to Experian's CreditExpert service and view my credit file very regularly), it's listed as a 'late' payment and there are repeated instances of '6 months late' going all the way back to when I stopped paying, around 3 years ago. From what you've said, if they were going to issue a default then they would have done so once I'd had two or three instances of '6 months late'. If they had declared it defaulted, would I have been notified? If they haven't declared a default, can they still do so at any time? Such as a day before the 6 year cut off point, to then start the 6 year period anew?
Do I actually have any grounds whatsoever to claim that I do not owe this money then? I'm not trying to weedle out of paying for something I've bought or a service I've received, I genuinely feel that I don't owe it as the contract was terminated in writing by NAC. I accept that what I paid up until the date of the letter was rightfully theirs (legally at least, if not morally) but from the moment they terminated the contract then I can't see how they can claim I should be paying them.
My apologies if I'm missing something blindingly obvious here. There is no pedantry intended, I'm just genuinely confused.
So: Assuming no default has or is declared, this will just drop off my credit file 6 years after the last recorded late payment. If no action is taken in that 6 year period, I'm in the clear and nothing can legally be done to either recover money from me or damage my credit rating (I'm thinking in terms of being accepted for a mortgage etc). Have I understood that correctly?
Regarding the car, it is a 2004 Ford Fiesta that was 4 years old at the time of purchase. If I remember correctly it had either a £6k or £6.5k sticker price and with the credit it worked out at just over £8.5k. The 'warranty' was a completely seperate entity with a seperate direct debit. The car is bought and paid for, it's just this supposed warranty that is the issue.0 -
Having just checked my file again, the exact wording (and formatting!) is '6 payments late' and the amount outstanding is £1154. Since I checked last night, the 'File Updated for the Period to:' column is now listed as last 29/01/2012, rather than 01/01/2012 as it said yesterday. So it would appear that late payments are still being lodged, which changes things.
Other the obvious and very galling option of coughing up this money, which I passionately disbelieve is owed, is there any person, department or agency that I could appeal to in order to:
a) Have the 'debt' quashed?
b) Have the adverse entries removed from my credit file?
Even if I did decide to just pay up, would it now be as simple as paying CarCraft, being as it appears the 'debt' has changed ownership two or three times? Would it be reasonable and appropriate to insist on the adverse entries being removed from my credit file? Is there a legally binding process of instigating such an arrangement, to ensure their end of the bargain (the removal) is honoured?0 -
Theres a legal precedent, to do with shipping, that you arent liable for insurance charges if you didnt meet the conditions.
As soo as they told you you no longer qualified, they agreed the insurance charges were invalid.
It was a ship that sank off the scottish islands.
Find the precedent and challenge them in court.0 -
Would that involve me employing a solicitor to take them to court? Or do I simply ring them up, tell them I don't believe I should pay and that they should take me to court?0
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personally i`d write to whoever is curently chasing this debt and suggest that they take you to court as you now believe the policy was cancelled by the insurers,tell them that if they dont take you to court you will assume that they agree and will remove all possible late payment markers
its worth a try0 -
Quick update:
Since my last post, I have received several, increasingly threatening solicitor's emails, each offering me the 'opportunity' to pay the alleged debt in full or face serious legal consequences. I have replied to each one, standing my ground and maintaning my view that I owed no money and would not be paying.
I replied to the last email on 6 July and today I decided to check my credit score on creditexpert.com. With no notification from the solicitor, all mention and evidence of this account has suddenly disappeared and my credit score has jumped from 290 to 795!
I'm not counting any chickens just yet, but it appears this is finally behind me.0 -
it maybe been soldDon't put your trust into an Experian score - it is not a number any bank will ever use & it is generally a waste of money to purchase it. They are also selling you insurance you dont need.0
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If I was in your situation, I would write to those chasing the debt saying that I will not be paying it, and invite them to take it to court.
My opinion is that a county court judge would throw it out as the policy has been declared null and void.
Although of no comfort to you, your experience is a classic example of why people should treat these car repair warranties as if they were the pox - which they are!"There are not enough superlatives in the English language to describe a 'Princess Coronation' locomotive in full cry. We shall never see their like again". O S Nock0 -
poppasmurf_bewdley wrote: »If I was in your situation, I would write to those chasing the debt saying that I will not be paying it, and invite them to take it to court.
This is presicely what I have done, in my original correspondance with CarCraft/NAC and more recently in responding to several emails from the solicitor they have employed, also proposing that all entries they have made on my credit file be removed.
As I say, on checking my credit file today, this appears to be just what has happened. The account isn't marked as 'settled' or 'satisfactory' or anything else, it has simply disappeared, like it was never there!
Am I right in thinking that, because they have voluntarily withdrawn the information then they have admitted culpability and could not now re-insert negative information onto my credit file without a signature from me?0
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