PCF Voluntary Termination

cowait

KimJongUn88 said:

cowait said:

My son has a car on a PCF and the term is up, he can either hand the car back and walk away or trade it back in and get another. Ford's naturally have given him a crap trade in price so he is inclined to walk away. However his mrs was at the dealers today and some smart !!!!!! salesman was telling her that if they handed it back it would look to a credit agency like they can not afford the payments and it would adversely affect their credit rating.

I have an idea he is just bulls***ing and trying to apply pressure to clinch a new deal. I would tell him to shove it, and also make a formal complaint about him being a lying t**t.

On the other hand..................is he right ? 

Ford offered a crap trade in? The whole point of a PCP is the value of the car at the end of the term is agreed at the start of the contract in the GFV figure. Why are you moaning about it being crap now?  You knew what the value would be right at the start.

KimJongUn88 said:

cowait said:

My son has a car on a PCF and the term is up, he can either hand the car back and walk away or trade it back in and get another. Ford's naturally have given him a crap trade in price so he is inclined to walk away. However his mrs was at the dealers today and some smart !!!!!! salesman was telling her that if they handed it back it would look to a credit agency like they can not afford the payments and it would adversely affect their credit rating.

I have an idea he is just bulls***ing and trying to apply pressure to clinch a new deal. I would tell him to shove it, and also make a formal complaint about him being a lying t**t.

On the other hand..................is he right ? 

Ford offered a crap trade in? The whole point of a PCP is the value of the car at the end of the term is agreed at the start of the contract in the GFV figure. Why are you moaning about it being crap now?  You knew what the value would be right at the start.

Don't be an ar**. I'm asking about the suggestion that simply returning the car will give an adverse report on the credit rating.

cowait

Not being an actual party to my son'd agreement I'm not really au fait with the terminology but the contract is at an end. So it's either trade it in and take out a new contract on another vehicle or walk away.

The suggestion the his credit rating would be affected was really the point of the query. I think that is just rubbish and a ploy by the salesman, but never having taken out such a contract I wondered if there was any truth in what the salesman claimed.

Grumpy_chap

If your son is at the end of a PCP term, so 3 or 4 years usually, then the term can just come to a natural conclusion.  However, that is at odds with the title of the thread referring to "Voluntary Termination" and also comments within the OP about the trade in price being less than desired.

If you can obtain clearer details from your son and share, then I am sure that people in the forum can provide good insight into the situation and options.  Unfortunately, at the moment, there is a lot of guess work.

How old is your son?
Do you normally get involved in his finances still?

AdrianC

cowait said:

Not being an actual party to my son'd agreement I'm not really au fait with the terminology but the contract is at an end. So it's either trade it in and take out a new contract on another vehicle or walk away.

The suggestion the his credit rating would be affected was really the point of the query. I think that is just rubbish and a ploy by the salesman, but never having taken out such a contract I wondered if there was any truth in what the salesman claimed.

And that's the point...

Your subject line says "voluntary termination". If your son used those words to the salesman, then he probably took them at face value. VT is not what happens at the end of the contract. VT is what you do if you want to get out of the contract part-way through. In that context, he was sort-of correct.

DrEskimo

Even VT wouldn't necessarily leave a bad mark on his credit file. One source suggests that the agreement is just noted as 'terminated', but this would apply in other situations, such as rejecting the car if it has a fault that cannot be repaired.

Source: https://www.thecarexpert.co.uk/car-finance-voluntary-termination-pcp-hp/2/

Nevertheless, in your sons position, you want to be absolutely sure of the true value of the car. Don't just take a single salepersons' word for it. Trade in will vary massively so do our research and find what a good trade in value for the car is. Ring multiple dealers and garages. You are free to sell the car to any garage you like, not just main dealers of the same manufacturer.
If the car is worth more, then it makes no sense just giving it back to the finance company. Not only that, but the process will also be more of a ballache....

There is also no obligation to trade in for a another car. You can just sell it to a garage for a price (which you obviously want to be the same, or more than the outstanding finance owing on it).

Or of course, just buy the car? If it is worth less, then maybe it's a good deal?!

neilmcl

cowait said:

Not being an actual party to my son'd agreement I'm not really au fait with the terminology but the contract is at an end. So it's either trade it in and take out a new contract on another vehicle or walk away.

The suggestion the his credit rating would be affected was really the point of the query. I think that is just rubbish and a ploy by the salesman, but never having taken out such a contract I wondered if there was any truth in what the salesman claimed.

No, the options are; hand the car back and walk away, pay the GMV and keep the car, or trade in to the dealer and use any equity left as a deposit toward a new deal.

born_again

cowait said:

Not being an actual party to my son'd agreement I'm not really au fait with the terminology but the contract is at an end. So it's either trade it in and take out a new contract on another vehicle or walk away.

Or pay the balloon payment & keep the car.

parking_question_chap

Deleted_User said:

AdrianC said:

Deleted_User said:

The GMV is agreed based on the car being in good condition, kept to mileage agreement etc. The dealer has every incentive to lower the value at the end by pointing out damage that isn't wear and tear e.g. scuffed alloys, paintwork scrapes etc and of course any excess mileage.

The industry standard fair wear and tear standards and expectations are VERY well documented.
https://issuu.com/bfwsn67/docs/bvrla_fair_wear_and_tear_standard_-_cb6bf45bb50403?e=2001091/30897824

Nothing in your link corrects what I said in my post, no matter what you type in capitals

Per your own link, scuffs over 50mm are not wear and tear, nor are dents, damage to spokes, wheel fascia etc; similarly scratches over 25mm are not, further those under can be excluded from wear and tear if primer/bare metal is showing or if they can't be polished out - with a maximum of 4 per panel. So despite it being VERY well documented, there is plenty of leeway there for the dealer to lower the GMV by picking out long scuffs, any scratches they claim can't be polished out etc

I know your reputation of wanting to have the last word on stuff, whether right or wrong so I'll leave you to it, I won't read any further responses on this post

Farfetch is correct with both of their paragraphs here.

rayca

cowait said:

My son has a car on a PCF and the term is up, he can either hand the car back and walk away or trade it back in and get another. Ford's naturally have given him a crap trade in price so he is inclined to walk away. However his mrs was at the dealers today and some smart !!!!!! salesman was telling her that if they handed it back it would look to a credit agency like they can not afford the payments and it would adversely affect their credit rating.

I have an idea he is just bulls***ing and trying to apply pressure to clinch a new deal. I would tell him to shove it, and also make a formal complaint about him being a lying t**t.

On the other hand..................is he right ? 

I have VT'd 2 cars as the trade in price against what was outstanding on the finance were miles apart so the dealer just said it would be easier to VT.. 
I have not had anything negative posted on my credit record ( I check clearscore and experian( free versions for both) ) and my credit score has remained unchanged . Most recently spoke with the finance company as the car had an issue the manufacturer were being a pain so i paid upto the VT and handed the car over to BCA car auctions ... In this case the finance company even confirmed that they were not actually looking at the damage of the car or excess mileage charges as it was not worth the hassle due to the amount of cars being handed back at the moment ( but i would still make sure you hand the car back clean and without engine warning lights)... The only way I can see that the credit record would be impacted is if you have not paid upto the VT point and just hand the car back and refuse to pay upto the VT( If you past this then this is not a problem)
Finance companies do not like you VTing a car as this means they are likely to loose money ( but that is not my problem).. but dealers are happy as it means they don't have to deal with another used car to get rid of and they can negotiate a new car  

AdrianC

rayca said:

cowait said:

My son has a car on a PCF and the term is up, he can either hand the car back and walk away or trade it back in and get another. Ford's naturally have given him a crap trade in price so he is inclined to walk away. However his mrs was at the dealers today and some smart !!!!!! salesman was telling her that if they handed it back it would look to a credit agency like they can not afford the payments and it would adversely affect their credit rating.

I have an idea he is just bulls***ing and trying to apply pressure to clinch a new deal. I would tell him to shove it, and also make a formal complaint about him being a lying t**t.

On the other hand..................is he right ? 

I have VT'd 2 cars as the trade in price against what was outstanding on the finance were miles apart so the dealer just said it would be easier to VT.. 

But that would not have been at the end of the finance term.