PCP Contract "hostile termination" - mislead by Volkswagen Financial Services!

StevenHendy94

Hi all,

I was looking for some advice.

I had a car on PCP from Volkswagen Financial Services (a Seat Leon), after 2 and a half year I started missing payments as I encountered financial difficulty.

After a default was issued, I spoke with VW to discuss my options, as much as I dreaded giving up my car, I agreed to a Voluntary Termination. Under the impression I would hand the car back, and that would be the end of it.
JCA Associates came to collect the car a few weeks later.

All was fine, until I got a letter some months later saying they had sold my car at auction for £5,000 (Far less than its worth, even at auction rates, plus took them months to sell it!). and that i was liable for the difference of £2,800.

I panicked, I can't remember exactly what i did after that, to be honest i think i burried by head in the sand and hoped it went away. But it didn't. Now i am in the process of clearing my debts, I need to tackle this one.

I phoned them, and their lawyers (who are handling the case) claim all their notes say it was a Hostile Termination, and I was offered VT and VS but refused both!

I was shocked so looked through my paper work. Turns out I had paid 50.001% (literally 80pence over the 50% total credit) so surely I would have automatically VT'd the car!

Any way, they swear blind I'm due the remainder etc. And my problem is I have very little proof of what the JCA man said, just me and two witnesses who were there when he said it was Voulntary and it would clear everything. I also have a calling card from him when he came to speak to me when i was out of the house. on the back he wrote "to discuss a " full settlement on Voulntary surrender of seat leon". which suggests it was a settlement and more so voulnatry. (however he claimed in person it was a VT and not a VS.

What do I do!! They've taken my car under completely false pretenses and now I'm due £2,700!

I have a meeting with a lawyer on Friday but because I have very little paperwork (he never gave me really any) i don't think I've got much hope.

I must stress I know i have been stupid not to get more documentation of exactly what was happening. But i do wish to stress at the time i had left work due to depression and was young and nievie! I believe the JCA associate took complete advantage of my situation for his own gain!

Also, I get laws are different - I am in Scotland.

Any advice would be very much appreciated.

Mainly, do i even have a leg to stand on here!?

Nearlyold

To VT a car with nothing more to pay you need to have paid 50% of the TOTAL amount payable - this includes the PCP bubble due at the end of the agreement - its not 50% of the total monthly payments

molerat

If the account was officially defaulted you lost the right to voluntary termination. VT is not automatic and you have to specifically state you are taking that route and not early terminating which does leave you liable for any shortfall.

motorguy

molerat wrote: »

If the account was officially defaulted you lost the right to voluntary termination. VT is not automatic and you have to specifically state you are taking that route and not early terminating which does leave you liable for any shortfall.

^^^^^^^

Exactly this.

Sorry, O/P but i think you're liable here for the shortfall.

motorguy

StevenHendy94 wrote: »

Hi all,

I was looking for some advice.

I had a car on PCP from Volkswagen Financial Services (a Seat Leon), after 2 and a half year I started missing payments as I encountered financial difficulty.

After a default was issued, I spoke with VW to discuss my options, as much as I dreaded giving up my car, I agreed to a Voluntary Termination. Under the impression I would hand the car back, and that would be the end of it.
JCA Associates came to collect the car a few weeks later.

All was fine, until I got a letter some months later saying they had sold my car at auction for £5,000 (Far less than its worth, even at auction rates, plus took them months to sell it!). and that i was liable for the difference of £2,800.

I panicked, I can't remember exactly what i did after that, to be honest i think i burried by head in the sand and hoped it went away. But it didn't. Now i am in the process of clearing my debts, I need to tackle this one.

I phoned them, and their lawyers (who are handling the case) claim all their notes say it was a Hostile Termination, and I was offered VT and VS but refused both!

I was shocked so looked through my paper work. Turns out I had paid 50.001% (literally 80pence over the 50% total credit) so surely I would have automatically VT'd the car!

Any way, they swear blind I'm due the remainder etc. And my problem is I have very little proof of what the JCA man said, just me and two witnesses who were there when he said it was Voulntary and it would clear everything. I also have a calling card from him when he came to speak to me when i was out of the house. on the back he wrote "to discuss a " full settlement on Voulntary surrender of seat leon". which suggests it was a settlement and more so voulnatry. (however he claimed in person it was a VT and not a VS.

What do I do!! They've taken my car under completely false pretenses and now I'm due £2,700!

I have a meeting with a lawyer on Friday but because I have very little paperwork (he never gave me really any) i don't think I've got much hope.

I must stress I know i have been stupid not to get more documentation of exactly what was happening. But i do wish to stress at the time i had left work due to depression and was young and nievie! I believe the JCA associate took complete advantage of my situation for his own gain!

Also, I get laws are different - I am in Scotland.

Any advice would be very much appreciated.

Mainly, do i even have a leg to stand on here!?

Just for the record, you can do a VT at ANY time.

A VT is NOT the right to walk away once you have paid more than 50% of the contract value, a VT is the right to terminate the contract at ANY time. That is a protected right under the Consumer Credit Act. However the finance company have rights too. If you VT and you havent paid 50% of the total contract value, they can claim up to that amount off you for example.

However once you have paid more than 50% of the total contract value you can walk away with nothing further to pay providing

(a) you have kept the car in acceptable condition
(b) you have not missed payments / fallen in to arrears.

It is therefore quite likely they DID take the car back on a Voluntary Termination, however because of (b) they are invoking their right to bill you for the shortfall between what the car made at auction and what you owe.

StevenHendy94

It's my understand, sounds like I might be wrong, that defaulting means they can refuse a VT but it is still possible if they agree to it.

motorguy

StevenHendy94 wrote: »

It's my understand, sounds like I might be wrong, that defaulting means they can refuse a VT but it is still possible if they agree to it.

It may well be, however a VT in itself does not mean you can automatically walk away with nothing further to pay.

There are parameters around the "nothing further to pay" bit (as listed above) and unfortunately you fall foul of the second one, so they're chasing you for the money.