Buying a used car from garage - credit card protection and unit stocking

sky_rat

I have put down a £300 non-refundable deposit for a car that's being sold by a garage and I had arranged to pick it up on Saturday (2nd March) to give me time to arrange a loan and insurance. The value of the car is £9,800.

I applied for a personal loan which is now in my bank account.

The seller at the garage contacted me today to ask if I had sorted the loan and then asked if I could do him a favour and transfer the money before month end (February 28th)

Im not daft enough to transfer the money to the garage and then collect the car days later and theres obviously some financial benefit for the garage to have the money before month end (commission, targets etc?)

I tried to use this as a bargaining tool, I only managed to get £100 off and a years tax so it's not much but the request made me a little nervous. So I ran an HPI check and Im considering using my credit card for extra protection but have some questions about both...


HPI check

The HPI check states "Licence plate and VIN currently recorded as having outstanding finance" for unit stocking. It does state "If you are buying from a dealer, you may come across this type of finance on your Vehicle History report. Talk it over with your dealer, check their liability and get confirmation in writing that they will clear the finance on the car you are buying. Unit Stocking is a common type of finance agreement used by motor dealers to enable them to fund the vehicles on their forecourt."

Credit card protection

My insurance broker told me that even if I pay for only part of the car (e.g. the deposit) using my credit card, then I will be protected for the whole vehicle in case anything goes wrong. Is this correct ?

Mercdriver

It is quite possible for a dealer to have up to £1m worth of cars in his possession, so obviously this won't work well for cashflow so they have finance secured on some or all of their vehicles. This is quite normal.

Yes when you use credit card (or finance secured in the car) Section 75 makes the jointly and severally liable.

DoaM

Unit stocking finance is normal - when you buy the vehicle that finance will be cleared.

Did you pay the deposit by credit card? If yes then that's enough to give you Section 75 protection. Otherwise pay any nominal sum (can be £10) by CC and you'll still get the protection - S75 is based on the purchase price, not how much you pay by CC.

sky_rat

DoaM wrote: »

Unit stocking finance is normal - when you buy the vehicle that finance will be cleared.

Did you pay the deposit by credit card? If yes then that's enough to give you Section 75 protection. Otherwise pay any nominal sum (can be £10) by CC and you'll still get the protection - S75 is based on the purchase price, not how much you pay by CC.

I paid the £300 deposit with debit card, but I've arranged to pay £2,000 on credit card (which I will pay off immediately IN FULL!) and the rest as a bank transfer.

So in this case I will be protected by credit card ?

waamo

sky_rat wrote: »

I paid the £300 deposit with debit card, but I've arranged to pay £2,000 on credit card (which I will pay off immediately IN FULL!) and the rest as a bank transfer.

So in this case I will be protected by credit card ?

Yes you will