Volvo pcp/fixed term loan

Deneb

facade wrote: »

Seems odd that Santander do this, they would simply become another creditor with little hope of making full recovery if the customer were to declare bankruptcy, having previously disposed of all their assets including the car.


With standard PCP/lease/HP Santander would always own the car, and could simply recover it in the event of a default.

Notwithstanding that it may not be the case here, I'm not sure why you think it odd.

Apart from my current car, I haven't had finance on one for over 35 years, and only did it this time because at 0% it hasn't cost me anything and I figure the money is better off earning me interest for as long as possible.

But when I did used to finance cars, it was always via an unsecured personal loan from a bank, so they had no equity in the vehicles anyway. The choice in those days unless you had the cash was either a bank loan or HP from the dealer, none of these fancy deals that persuade some people that they can buy something they can't really afford. Maybe having been out of the loop for so long, you can't get a personal loan to buy a car nowdays? I don't know, but I personally wouldn't touch a contract purchase agreement with a barge pole

motorguy

molerat wrote: »

The link you posted is what the op thought they had but Santander and Volvo think it is something different.

Which looks to me like a secured loan with a balloon payment? Not a hire purchase agreement.

motorguy

Deneb wrote: »

Notwithstanding that it may not be the case here, I'm not sure why you think it odd.

Apart from my current car, I haven't had finance on one for over 35 years, and only did it this time because at 0% it hasn't cost me anything and I figure the money is better off earning me interest for as long as possible.

But when I did used to finance cars, it was always via an unsecured personal loan from a bank, so they had no equity in the vehicles anyway. The choice in those days unless you had the cash was either a bank loan or HP from the dealer, none of these fancy deals that persuade some people that they can buy something they can't really afford. Maybe having been out of the loop for so long, you can't get a personal loan to buy a car nowdays? I don't know, but I personally wouldn't touch a contract purchase agreement with a barge pole

And arguably, at the time if you had to resort to a bank loan or HP, you couldnt afford it? Not sure how taking a PCP deal means you cant afford it?

Yes, you can still get bank loans no problem on a new car. The "problem" being that if a new car is say £30K then the monthly payment can become very large. A PCP agreement tends to avoid that and may well be at 0% or a very low APR anyway.

ajest1977

@DanielleOHara

Just wondered if you'd got any joy with your situation yet?

I'm having exactly the same issue with Volvo/Santander at present, was sold PCP but Santander are telling me I've taken out a personal loan (which is not what I signed up for as I didn't want to keep hold of the car at the end of the term!) I was also told when I got the car that I could hand it back at any time with no qualms or penalties and that is not the case!

My husband has been looking on 'Legal Beagle' website and it appears that Volvo are notorious for doing this! I'm extremely frustrated and annoyed as I expect you are too.

Look forward to hearing from you.

Nearlyold

A PCP can be based on HP, Conditional Sale, or Fixed Sum/Term Loan (basically a Personal Loan).

All have the same options at the end. HP & Conditional Sale have VT rights in addition. There is no legal requirement for a PCP to be based on HP, it's just that most are.

NONE of them allow you to simply hand the car back any time you want.

HalfBakedJake

Hi All,

I know this is an old post but I had the same issue 2 years ago.

It was my first PCP with Volvo and on initial meeting I informed them that I would require 12000 miles a year rather than the stated 8000 to which they adjusted the amount I would pay.

I was asked in to sign the details the contract a few days later so came in and naively didn’t read the contract fully with a tooth comb prior to signing the deal.

I received my car absolutely fine...

Go into the future 4 years and I am now in a VW garage if the same group and looking for another car here. The VW salesman tells me that I should be able to terminate early with Volvo to get me in the new car. He tells me there’s a problem and I go over to the Volvo garage across the road to talk to them.

They inform me that my PCP is actually called a PCP Personal Loan and that Santander would choose people randomly to put on the PCP Personal Loan rather than the PCP deal they normally put people on. On top of this they inform me that I only have 8000 miles a year.

I tell the manage that I definitely chose to do 12000 miles which is why I was paying the additional 30-40 pounds per month and all he did was say that “you signed the contract”

I now had a car with 32000 miles 3 years into a 4 year “PCP” so every mile I went over was going to cost me.

Luckily the car I was buying had a £5000 off offer so the VW salesman bought the car off me for a £2000 deficit at my end and added £2000 to the price of the new car.

I have now learnt my lesson to never trust a salesman. Basically never purchase anything from anyone who offers Santander Consumer Products.

Hopefully in the future there will be some sort of group lawsuit against them I can join and get some money back.

Nearlyold

While it would be the salesman who arranged a PCP with 8,000 miles pa rather than 12,000, he would have no control over whether Santander offered an HP/Conditional Sale based PCP or a Personal Loan based PCP

Santander's loan underwriters make that decision on commercial grounds, essentially where they calculate the risk of a VT outweighs the security aspect of the loan being secured on the vehicle.

The salesman should of course have pointed out your PCP agreement was Personal Loan based when he went through the paperwork with you.

Those "extra miles" would always cost you as a 12,000 mile pa PCP would have higher monthlies than an 8000 one. If you were paying extra without getting extra miles can only assume the APR must have been higher than you were first quoted.

AdrianC

HalfBakedJake wrote: »

It was my first PCP with Volvo and on initial meeting I informed them that I would require 12000 miles a year rather than the stated 8000 to which they adjusted the amount I would pay.

I was asked in to sign the details the contract a few days later so came in and naively didn’t read the contract fully with a tooth comb prior to signing the deal.
...
I tell the manage that I definitely chose to do 12000 miles which is why I was paying the additional 30-40 pounds per month and all he did was say that “you signed the contract”

And what did the contract you signed state?