Car loan - how does right of withdrawal work?

murmeltier

Hi


I'm buying a new car from a reputable nationwide dealership and got a price I'm fairly happy with.


They insisted I take out finance (presumably because they earn commission), despite me having all the cash available.


I have signed the finance (HP agreement) a few days ago, the car will be delivered next week.


I am planning to make use of my "right of withdrawal" within the 14 day "cooling off" period, but I'm unsure when and how to best go about this.


When is the best time to withdraw? Presumably only after the car has been delivered, as I don't want to annoy the dealer?


What exactly should I do? Is phoning the finance company enough (the agreement states oral withdrawal is fine), or is it best to send a letter by recorded delivery and enclose a cheque? Or will I need to wait for them to tell me how much exactly and when exactly to pay (as presumably I will have to pay a few day's interest)?


Also, does anyone know when the 14 day period starts, the agreement states "on the day I receive the signed & executed copy of the agreement". I have been given a copy of the agreement, but it's called "proposal" at the top and hasn't got my signature on it, i.e. it's not really a copy in my view. Does this mean the 14 days have now started, or they haven't?


And finally ... out of curiosity, will the dealership lose their commission on the finance when I withdraw?


Many thanks
murmeltier

Gaz83

murmeltier wrote: »

Hi


I'm buying a new car from a reputable nationwide dealership and got a price I'm fairly happy with.


They insisted I take out finance (presumably because they earn commission), despite me having all the cash available.


I have signed the finance (HP agreement) a few days ago, the car will be delivered next week.


I am planning to make use of my "right of withdrawal" within the 14 day "cooling off" period, but I'm unsure when and how to best go about this.


When is the best time to withdraw? Presumably only after the car has been delivered, as I don't want to annoy the dealer?


What exactly should I do? Is phoning the finance company enough (the agreement states oral withdrawal is fine), or is it best to send a letter by recorded delivery and enclose a cheque? Or will I need to wait for them to tell me how much exactly and when exactly to pay (as presumably I will have to pay a few day's interest)?


Also, does anyone know when the 14 day period starts, the agreement states "on the day I receive the signed & executed copy of the agreement". I have been given a copy of the agreement, but it's called "proposal" at the top and hasn't got my signature on it, i.e. it's not really a copy in my view. Does this mean the 14 days have now started, or they haven't?


And finally ... out of curiosity, will the dealership lose their commission on the finance when I withdraw?


Many thanks
murmeltier

Maybe I'm missing something, but why are you cancelling?

murmeltier

I'm cancelling the finance (not the sale of the car) because I don't want to pay 7% interest over the next 5 years which works out like something over £4,000 in total?


Is there anything that I've overlooked that means I can't do this?

Stevefromdonny

Done this myself recently. Phoned finance company. Do it as soon as, because Black Horse charged about £5 interest per day even during the cooling off period.

The dealership may well loose their commision yes, but in my case I was extremely glad this may have been the case, incompetent gets.

jonesMUFCforever

I think OP is talking about early repayment of finance - not cancelling.
I hope he has had a sweetener like Ford wanted to give me £500 or I would not have bothered in first place.

Stevefromdonny

jonesMUFCforever wrote: »

I think OP is talking about early repayment of finance - not cancelling.
I hope he has had a sweetener like Ford wanted to give me £500 or I would not have bothered in first place.

No, he is wanting to exercise his right of withdrawal within 14 days. It seems his dealer insisted he take finance even thought he had the funds to buy the car. I'd have walked away myself, or gone away and drawn the cash out of the bank just to inconvenience them. :rotfl:

murmeltier

Yeah, I have the funds, but they wouldn't want to do a deal at the price I wanted and the wife wants the car so I accepted the finance ... I don't want them to have any more of my money than really necessary which is why I am planning to withdraw as soon as delivery is done.

Gaz83

So are you planning on withdrawing from the finance and paying the cash directly to the finance company (or the garage)?

jonesMUFCforever

If it was me I would let the finance go through - then pay the finance company off straight away to minimise interest.
If you pull out could they sue you for breach of contract?
You have agreed £x for the car providing you use their finance - if you pull out they could (reasonably IMO) argue that you should be paying £y which will be a higher figure.


If you are determined to pull out TELL them now and get it in writing what the £x will be , It will stop a lot of stress and tears after.


As I said earlier Ford finance/dealer gave me extra trade in of £500 provided I purchased new car with Ford finance which I did - but paid it back direct to Ford Finance within 7 days of owning the car. I have no idea whether this affected the commission etc which the dealer got or not got - nobody came back to me to complain.

murmeltier

Thanks, I definitely don't want to mess this up.


I'll let the finance go through, collect the car, and then phone the finance company. If they advise that I can withdraw at this point, fine; otherwise I will have to go for early settlement but I suspect this will include their "arrangement fees" which I wouldn't mind not having to pay ...


I doubt the dealership can sue for breach of contract as nowhere in the sale contract does it say the sale is contingent on the finance being taken out.


Which makes me wonder what would have happened had I been declined by the finance company - surely the dealership wouldn't have been entitled to cancel the contract if I have the cash to pay the purchase price agreed in the contract?

bigadaj

I think it's the finance company that could have sued rather than the car dealership.