Paying off car finance with a credit card

WillowK

We have reached the end of our finance agreement on our car and we want to pay off the balloon payment by credit card.

My husband tried to do so on Monday but were initially told they could accept card payments because they were working from home and it was for security reasons.

I called back and was told the same thing but that I could pay online. Asked how because it wasn't letting me to be informed they were mistaken and that was only for early settlement payments not final payments.

I said that was unreasonable and asked to be put through to escalations. Here I received a different story and was told that they could accept credit card payments for legal reasons to do with the transfer of title. After again going through how unreasonable this was given two weeks earlier I could have paid by card the guy eventually conceded that I could pay the majority by credit card and a smaller final amount by credit card but that he would need to put me through to collections as they were the only staff in the office who could take card payments.

After nearly an hour on hold got through to someone who was working from home 🤦‍♀️ so he arranged a call back.

They have finally called back this morning (four days later) and are now again saying they won't accept a credit card payment. I have asked for a manager to call me back (which could be another five days!!) as I still maintain it is unreasonable that two weeks ago I could have paid by card and that they somehow expect people to have such large amounts of money in the bank. They are ofcourse more than willing to refinance 🙄

At no point in communication with them about the settlement prior to this week has the inability to pay by credit card been mentioned and I can't find anything in any paperwork.

Where do we stand legally with this? Is it just a battle of wills and try to find a creative solution (re-finance and immediately settle early is an option but I need to check what fees apply, also transfer cash from credit card but again...fees) or would we have grounds for an FSA complaint?

Any advice greatfully received

WillowK

Sorry - this should say: My husband tried to do so on Monday but were initially told they couldn't accept card payments because they were working from home and it was for security reasons.

feolojad

Most finance companies, even banks, won't accept settling an agreement by credit card. Usually they want a debit card, bank transfer or cheque sending. Where you stand legally with this is you find a method they accept and pay by that. There is no legal requirement for anyone to accept card payments, they're free to choose not to.

[Deleted User]

The firm has to pay for accepting a credit card payment - they are quite within their rights to say no.
There is no legal battle, there is no FSA complaint (why would the Food Standards Agency be involved?)
You agreed to pay the balloon, you pay the balloon, they tell you what payments they accept and you choose one of them.
If you really want to pay by card, get a money transfer 0% one and put the money into your account and use that

Also

"and that they somehow expect people to have such large amounts of money in the bank"

Well yes, that is perfectly normal, when you took out the car finance you knew you had to pay the balloon (or trade in the car) so normal people who intended to do that would have saved up the money during the finance period and paid it off.

WillowK

Thanks Feolojad.
Farfetch - thank you for your response - really not sure why you felt the need to be so sarcastic though - no one mentioned a legal battle (i think you misread 'battle of wills') and I meant the FCA (I was thinking standards not conduct is all).

Of course I knew I had to pay the balloon payment - and was planning on paying by credit card on a 0% deal (which is the most cost effective method for us). There is no mention of not accepting credit card payments in any of the paperwork they have sent me nor was it mentioned in any of the options phone calls we have had with them, so it was not unreasonable for me to plan to pay by a method commonly used for large payments.

My question was simply whether they have a legal right to refuse payment by credit card. The answer appears to be yes, so we will pay by a different method. If it had been clear from the start, it wouldn't be an issue - we would have done exactly as you suggested and simply arranged a money transfer. However, their lack of transparency, mixed messages and crappy customer service means that rather than this being a planned solution, it will be unplanned and may end up costing additional fees etc which could have been avoided.

Luckily I have options - but others may not,  and their legal right does not excuse their lack of transparency and !!!!!! poor customer service, so that is a complaint that will be pursued.

TadleyBaggie

When I paid off my PCP a few years ago they would only accept a bank transfer, Nissan via RCI.

[Deleted User]

WillowK said:

Thanks Feolojad.
Farfetch - thank you for your response - really not sure why you felt the need to be so sarcastic though - no one mentioned a legal battle (i think you misread 'battle of wills') and I meant the FCA (I was thinking standards not conduct is all).

Of course I knew I had to pay the balloon payment - and was planning on paying by credit card on a 0% deal (which is the most cost effective method for us). There is no mention of not accepting credit card payments in any of the paperwork they have sent me nor was it mentioned in any of the options phone calls we have had with them, so it was not unreasonable for me to plan to pay by a method commonly used for large payments.

My question was simply whether they have a legal right to refuse payment by credit card. The answer appears to be yes, so we will pay by a different method. If it had been clear from the start, it wouldn't be an issue - we would have done exactly as you suggested and simply arranged a money transfer. However, their lack of transparency, mixed messages and crappy customer service means that rather than this being a planned solution, it will be unplanned and may end up costing additional fees etc which could have been avoided.

Luckily I have options - but others may not,  and their legal right does not excuse their lack of transparency and !!!!!! poor customer service, so that is a complaint that will be pursued.

Your post, penultimate paragraph

Where do we stand legally with this?

Post wasn't sarcastic at all, it's a statement of facts

FCA won't entertain a complaint any more than the FSA on the basis that you wanted to pay by credit card and the firm won't accept it due to the fees they have to pay to process a card payment.

Any business has a legal right to refuse any form of payment (yes, including cash) for a debt

As I said, if you want to use a card, look for a Money Transfer card that will let you transfer a sum (for a fee) into your bank account which you can pay off at 0% for 12-18 months

Car_54

Deleted_User said:

WillowK said:

Thanks Feolojad.
Farfetch - thank you for your response - really not sure why you felt the need to be so sarcastic though - no one mentioned a legal battle (i think you misread 'battle of wills') and I meant the FCA (I was thinking standards not conduct is all).

Of course I knew I had to pay the balloon payment - and was planning on paying by credit card on a 0% deal (which is the most cost effective method for us). There is no mention of not accepting credit card payments in any of the paperwork they have sent me nor was it mentioned in any of the options phone calls we have had with them, so it was not unreasonable for me to plan to pay by a method commonly used for large payments.

My question was simply whether they have a legal right to refuse payment by credit card. The answer appears to be yes, so we will pay by a different method. If it had been clear from the start, it wouldn't be an issue - we would have done exactly as you suggested and simply arranged a money transfer. However, their lack of transparency, mixed messages and crappy customer service means that rather than this being a planned solution, it will be unplanned and may end up costing additional fees etc which could have been avoided.

Luckily I have options - but others may not,  and their legal right does not excuse their lack of transparency and !!!!!! poor customer service, so that is a complaint that will be pursued.

Your post, penultimate paragraph

Where do we stand legally with this?

Any business has a legal right to refuse any form of payment (yes, including cash) for a debt

Not quite. They MUST accept cash in payment of a debt - Bank of England notes (in England and Wales only) and/or Royal Mint coins, subject to limits on the amount of small coins.

See https://www.bankofengland.co.uk/knowledgebank/what-is-legal-tender

[Deleted User]

Car_54 said:

Deleted_User said:

WillowK said:

Thanks Feolojad.
Farfetch - thank you for your response - really not sure why you felt the need to be so sarcastic though - no one mentioned a legal battle (i think you misread 'battle of wills') and I meant the FCA (I was thinking standards not conduct is all).

Of course I knew I had to pay the balloon payment - and was planning on paying by credit card on a 0% deal (which is the most cost effective method for us). There is no mention of not accepting credit card payments in any of the paperwork they have sent me nor was it mentioned in any of the options phone calls we have had with them, so it was not unreasonable for me to plan to pay by a method commonly used for large payments.

My question was simply whether they have a legal right to refuse payment by credit card. The answer appears to be yes, so we will pay by a different method. If it had been clear from the start, it wouldn't be an issue - we would have done exactly as you suggested and simply arranged a money transfer. However, their lack of transparency, mixed messages and crappy customer service means that rather than this being a planned solution, it will be unplanned and may end up costing additional fees etc which could have been avoided.

Luckily I have options - but others may not,  and their legal right does not excuse their lack of transparency and !!!!!! poor customer service, so that is a complaint that will be pursued.

Your post, penultimate paragraph

Where do we stand legally with this?

Any business has a legal right to refuse any form of payment (yes, including cash) for a debt

Not quite. They MUST accept cash in payment of a debt - Bank of England notes (in England and Wales only) and/or Royal Mint coins, subject to limits on the amount of small coins.

See https://www.bankofengland.co.uk/knowledgebank/what-is-legal-tender

No, I am correct, they DON'T have to accept cash. Read the link you posted 

Legal tender has a narrow technical meaning which has no use in everyday life. It means that if you offer to fully pay off a debt to someone in legal tender, they can’t sue you for failing to repay.

The use of "legal tender" is basically only relevant to debt where, if someone tries to pay the debt using legal tender, the receiving party must accept it (or cannot sue you if they refuse to accept it). The firm can refuse to accept cash for this debt but more fool them if they did as there would be an interesting legal situation as to whether the debt was then enforceable.

Regardless, OP isn't trying to pay in cash

Car_54

Deleted_User said:

Car_54 said:

Deleted_User said:

WillowK said:

Thanks Feolojad.
Farfetch - thank you for your response - really not sure why you felt the need to be so sarcastic though - no one mentioned a legal battle (i think you misread 'battle of wills') and I meant the FCA (I was thinking standards not conduct is all).

Of course I knew I had to pay the balloon payment - and was planning on paying by credit card on a 0% deal (which is the most cost effective method for us). There is no mention of not accepting credit card payments in any of the paperwork they have sent me nor was it mentioned in any of the options phone calls we have had with them, so it was not unreasonable for me to plan to pay by a method commonly used for large payments.

My question was simply whether they have a legal right to refuse payment by credit card. The answer appears to be yes, so we will pay by a different method. If it had been clear from the start, it wouldn't be an issue - we would have done exactly as you suggested and simply arranged a money transfer. However, their lack of transparency, mixed messages and crappy customer service means that rather than this being a planned solution, it will be unplanned and may end up costing additional fees etc which could have been avoided.

Luckily I have options - but others may not,  and their legal right does not excuse their lack of transparency and !!!!!! poor customer service, so that is a complaint that will be pursued.

Your post, penultimate paragraph

Where do we stand legally with this?

Any business has a legal right to refuse any form of payment (yes, including cash) for a debt

Not quite. They MUST accept cash in payment of a debt - Bank of England notes (in England and Wales only) and/or Royal Mint coins, subject to limits on the amount of small coins.

See https://www.bankofengland.co.uk/knowledgebank/what-is-legal-tender

No, I am correct, they DON'T have to accept cash. Read the link you posted 

Legal tender has a narrow technical meaning which has no use in everyday life. It means that if you offer to fully pay off a debt to someone in legal tender, they can’t sue you for failing to repay.

The use of "legal tender" is basically only relevant to debt where, if someone tries to pay the debt using legal tender, the receiving party must accept it (or cannot sue you if they refuse to accept it). The firm can refuse to accept cash for this debt but more fool them if they did as there would be an interesting legal situation as to whether the debt was then enforceable.

Regardless, OP isn't trying to pay in cash

It wouldn't be an interesting legal situation. It would be clearcut. They would have refused legal tender in payment of a debt, and so could not pursue the debtor further.

Ebe_Scrooge

I have to side with Car_54 on this one.  Bank of England notes are legal tender.  If you offer to pay a debt using them, and the creditor refuses to accept them, then the debt is effectively written off.

As the website explains, the concept of legal tender is of little practical use in everyday life - cheques, debit cards, etc. are not actually legal tender, but are so commonplace and widely accepted that there is little chance of dispute.  But anyone could legitimately refuse to accept them, and insist on payment in legal tender.  Many retailers and small businesses can and do refuse to accept credit cards.

The only time it becomes an issue is in the above-mentioned (and hypothetical) scenario where you offer to pay a debt using legal tender and the creditor refuses to accept it.  In that case, the creditor must either accept the legal tender or write off the debt.

(An interesting side note.  Scottish bank notes, whilst widely accepted, are not legal tender - even in Scotland)