PCP Voluntary Termination Hell - please help!

Mercdriver

neilmcl wrote: »

Because it's not a PCP but a conditional sale with balloon. Once he pays his full liability (balloon and excess charges) he can have the car back.

Am I being stupid? (Has been know lol). Surely if he has paid the full amount under agreement including balloon payment then the car is his, so why would he have to pay for mileage?

neilmcl

Mercdriver wrote: »

Am I being stupid? (Has been know lol). Surely if he has paid the full amount under agreement including balloon payment then the car is his, so why would he have to pay for mileage?

Your right, it's me who's being stupid. It's been a long day.

Mercdriver

So OP, looks like your best bet is to pay the remaining balloon payment. Then decide whether you want to keep the car or sell on. The balloon payment appears to be cheaper than the excess miles.

Oh and in future be wary of the salesman massaging the estimated miles down unrealistically.

tonyh66

Mercdriver wrote: »

So OP, looks like your best bet is to pay the remaining balloon payment. Then decide whether you want to keep the car or sell on. The balloon payment appears to be cheaper than the excess miles.

Oh and in future be wary of the salesman massaging the estimated miles down unrealistically.

Some people actively encourage this to keep the monthly payment low.

Scrapit

Sounds like this was entirely the wrong deal for your needs

RedSkyAtNight

He has already returned the car.
Their letter outlines the PCP agreement option of return the car and pay nothing else (except mileage fees I presume). However he has returned the car and still being told he has 'liability' payment (balloon payment) due.

The contract clearly states that if you return car at the end, then there will be nothing left to pay. He isn't behind on any payments.

The VT was recommended by an independent advisor. The finance company agreed to the VT, he was approaching end of contract anyway and he has paid back well over 50% of total amount payable.

It doesn't make sense to me that it would be a condition of sale when they stated at the beginning of the letter the PCP agreement option of return the car and have nothing left to pay.

AdrianC

How many miles has he done?
How many miles was he contracted to do?


Excess mileage might or might not fall under "acceptable condition" on a VT. The lenders say it does, some borrowers say it doesn't. It's been to court a few times and the lenders have won, but there's no definitive precedent been set.


Normally on a PCP, you have two basic options.
1 - Return the car, call it quits. Excess mileage applies.
2 - Pay the balloon, keep the car. Excess mileage does not apply. Whether you actually keep the car, or PX it, or whatever... you're still paying the balloon.


How much was the total finance package?
How much has he paid in total?
How much is the car worth now?


You have a statutory right to VT, but only once 50% of the total borrowed - INCLUDING the balloon - has been paid.

neilmcl

RedSkyAtNight wrote: »

He has already returned the car.
Their letter outlines the PCP agreement option of return the car and pay nothing else (except mileage fees I presume). However he has returned the car and still being told he has 'liability' payment (balloon payment) due.

The contract clearly states that if you return car at the end, then there will be nothing left to pay. He isn't behind on any payments.

The VT was recommended by an independent advisor. The finance company agreed to the VT, he was approaching end of contract anyway and he has paid back well over 50% of total amount payable.

It doesn't make sense to me that it would be a condition of sale when they stated at the beginning of the letter the PCP agreement option of return the car and have nothing left to pay.

Sorry, but you can see how this is so confusing when you tell us one thing then another entirely different. You say you VT'd approaching the end of the contract but earlier you said the agreement had already come to an end and you had tried to PX the car but when this was unsuccessful you wanted to VT to avoid the balloon payments. You're also say you had nothing left to pay yet Santander are saying you're in arrears.

Lets take a step back and look at your actual agreement paperwork. Can you give us the exact figures including the GFV (balloon payment) listed there? Can you also tell us the end date of the agreement. Also, are you absolutely this is a standard PCP and not their Conditional Sale with Balloon Payment product.

neilmcl

Further to the above, and you'll see why we need clarification on a few points. The rules for terminating a contract under a VT are quite clear. You can only terminate prior to the final payment, I'm not sure whether this means final monthly payment or does it also include the optional final payment, ie, the balloon payment. Section 99 of the Consumer Credit Act also states that you're liable for anything accrued before the termination, in other words if you enacted the VT process at the end end of the agreement then you may be still liable for the balloon payment as this liability had accrued before your termination.

I strongly suggest you take some proper legal advice on the matter. Also might be worth posting in the Vehicle Finance section of the Legal Beagles forums - https://legalbeagles.info/forums/forum/legal-forums/motoring-parking/vehicle-finance-and-issues