Trying to immediately cancel Hire Purchase Agreement

ClaireCE

I saw a car online and agreed to buy it. The dealer arranged finance with a finance company. I signed the finance documents but I did not sign anything for the dealer. The next morning I changed my mind. I sent a letter to the finance company attached to an email saying that I was cancelling the finance agreement. They responded asking me to phone them.


So I phoned the finance company who said: 'We've already paid out to the dealer so if you cancel we will bill you for the cost of the car. You had better phone the dealer instead and tell them to return our money'.


So I phoned the dealer who said: 'I don't know how this works. You'll have to phone back to tomorrow. It may be that you can exchange for another car. You see it's already a live agreement because you signed already'.


What should I do?


The car and the money for the car are with the dealer.


I have never visited the dealer, I have never seen the car and I have never taken delivery or collection for it.


How should I proceed?

motorguy

ClaireCE wrote: »

I saw a car online and agreed to buy it. The dealer arranged finance with a finance company. I signed the finance documents but I did not sign anything for the dealer. The next morning I changed my mind. I sent a letter to the finance company attached to an email saying that I was cancelling the finance agreement. They responded asking me to phone them.


So I phoned the finance company who said: 'We've already paid out to the dealer so if you cancel we will bill you for the cost of the car. You had better phone the dealer instead and tell them to return our money'.


So I phoned the dealer who said: 'I don't know how this works. You'll have to phone back to tomorrow. It may be that you can exchange for another car. You see it's already a live agreement because you signed already'.


What should I do?


The car and the money for the car are with the dealer.


I have never visited the dealer, I have never seen the car and I have never taken delivery or collection for it.


How should I proceed?

For the avoidance of doubt, you signed a finance agreement for a car but havent seen the car....? Okay....

So where and how did you sign the finance agreement?

It seems highly unlikely that the finance company have paid out for a car the customer hasnt picked up yet.

ClaireCE

People buy cars online all the time. It's very common. The dealer should not have asked the finance company to pay out without first asking me to sign an order form. So the dealer failed to do that first...

shaun_from_Africa

ClaireCE wrote: »

The dealer should not have asked the finance company to pay out without first asking me to sign an order form. So the dealer failed to do that first...

There is no legal requirement for you to have to sign anything for there to be a contract between you and the dealer.
You stated that you agreed to buy the car and this along with your completing the finance documents shows that you had the intent to make the purchase so IMO, the dealer was well within their rights to ask the finance company to make the payment to them.

ClaireCE wrote: »

I saw a car online and agreed to buy it. The dealer arranged finance with a finance company. I signed the finance documents but I did not sign anything for the dealer.

Aylesbury_Duck

You seem very clued up on the technicalities of the process after the event.

I think you're covered under consumer regulations related to distance selling so I've no doubt you'll get your money back, but perhaps do a bit more research before you buy the next car so impulsively.

AdrianC

What do you want to cancel? The finance, or the car purchase?

You have 14 day cooling off period by law to cancel the finance agreement - and you've set that in train.

That doesn't cancel the car purchase, though - and you need to find another way to pay for the car you bought.

You do not have any legal right to a cooling-off period on a used car purchase in general - although you may have a right in this instance under distance selling regs.

motorguy

ClaireCE wrote: »

People buy cars online all the time. It's very common. The dealer should not have asked the finance company to pay out without first asking me to sign an order form. So the dealer failed to do that first...

It is very common, yes. But you havent told us where you signed the form, and how / why you came to have signed a finance agreement (presumably on the dealers premises) without seeing the car?

Mercdriver

motorguy wrote: »

It is very common, yes. But you havent told us where you signed the form, and how / why you came to have signed a finance agreement (presumably on the dealers premises) without seeing the car?

Could be an electronic signature on a web page, perhaps. I wouldn't ever do this from outside the dealer's premises, though.

motorguy

Mercdriver wrote: »

Could be an electronic signature on a web page, perhaps. I wouldn't ever do this from outside the dealer's premises, though.

I didnt think you were allowed to do it anywhere other than the dealers site, otherwise it was invalid.

Could be wrong though

Mercdriver

motorguy wrote: »

I didnt think you were allowed to do it anywhere other than the dealers site, otherwise it was invalid.

Could be wrong though

All the signatures I did with Santander were electronic at the dealers. I don't know the technicalities of whether it would theoretically be possible outside of the dealer...

sheslookinhot

Electronic signatures on documents are perfectly acceptable. Why wouldn’t they be ?