Miscalculation on PCP discovered after delivery

darrendgw

Hi there 
I would just like a bit of advice to understand my potential rights or  available options in relation to the below.

I had a  PCP agreement on a new vehicle from a UK dealership that commenced in 2019.
The PCP is via the manufacturers finance.
Before the conclusion of the agreement I shopped around for potential options to upgrade with the same vehicle manufacturer.
I initially used a well known new car website to assist in getting a good price comparison from various dealers.
Within this website on their message system I liaised with my preferred manufacturer dealership.

I included what vehicle I wanted , as well  as detailing my current vehicle. 

 I included my VRM, current mileage and the fact that my vehicle was on the finance agreement with the manufacturer.
I included the fact that I wanted to exchange my current vehicle.

I was given a price including monthly payments for the new vehicle with the above part exchange.
It was confirmed that I would then stop paying the old car monthly payments and only pay for the new car monthly payments once delivery occurred.

The delivery and exchange was completed.
5 weeks later a representative from the dealership has contacted me. The outstanding finance on the part exchange was not taken into consideration when the calculation was completed.
So in simple terms as an example

 ( figures approx)

Old car - no longer in my possession handed back to dealership. I am not making further payments. Amount outstanding £11k.
Old payments was £230 per month.

New car in my possession 
Monthly payments of £203.

The dealership now suggested that I should pay off the outstanding finance to keep my current payments as they are. 
( I pay them £11k)

Or my current payments may need to double to a figure around £400 per month.

I have explained that both options are not acceptable as that is not within my financial reach.
I also explained that had I known that the payments would of been around £400 compared with £200 , then I would of retained my original vehicle beyond the conclusion of the agreement.

The dealership are now liaising with the manufacturer finance to come up with options but I would appreciate any advice before committing to future decisions.
Thanks in advance.

Sandtree

So did you declare that your PX had outstanding finance on it?
Have you checked your credit file to see if the original vehicle finance is showing as settled/missed payments etc?
Did you not notice they deducted the full value of the PX vehicle rather than the difference between offer and finance settlement figure?
What does your paperwork say about the PX?

AdrianC

You PXd your PCP car part-way through the term.
The dealer failed to include the £11k settlement negative equity.
Now they're correcting that error.

That is a VERY big error for them to swallow.
It's also one that, I suspect, would have been very apparent to you if you were familiar with your existing finance package.

No, it should not have got this far. But, basically, you're asking if you should walk away £11k up because of their error...

darrendgw

AdrianC said:

You PXd your PCP car part-way through the term.
The dealer failed to include the £11k settlement negative equity.
Now they're correcting that error.

That is a VERY big error for them to swallow.
It's also one that, I suspect, would have been very apparent to you if you were familiar with your existing finance package.

No, it should not have got this far. But, basically, you're asking if you should walk away £11k up because of their error...

Hi Thank you.
I am just asking what my options are, as stated had I known that the price would of been 400 a month as opposed to 200 I would of chosen to stay with my old car. I obviously do not want to be burdened with a higher monthly cost now due to their miscalculation.
so I’m not actually asking if I should walk away with 11k . Are you able to offer any advice ?

darrendgw

darrendgw said:

AdrianC said:

You PXd your PCP car part-way through the term.
The dealer failed to include the £11k settlement negative equity.
Now they're correcting that error.

That is a VERY big error for them to swallow.
It's also one that, I suspect, would have been very apparent to you if you were familiar with your existing finance package.

No, it should not have got this far. But, basically, you're asking if you should walk away £11k up because of their error...

Hi Thank you.
I am just asking what my options are, as stated had I known that the price would of been 400 a month as opposed to 200 I would of chosen to stay with my old car. I obviously do not want to be burdened with a higher monthly cost now due to their miscalculation.
so I’m not actually asking if I should walk away with 11k . Are you able to offer any advice ?

Sorry forgot to add I did not recognise any errors as the monthly payments were very similar 

k3lvc

darrendgw said:

AdrianC said:

You PXd your PCP car part-way through the term.
The dealer failed to include the £11k settlement negative equity.
Now they're correcting that error.

That is a VERY big error for them to swallow.
It's also one that, I suspect, would have been very apparent to you if you were familiar with your existing finance package.

No, it should not have got this far. But, basically, you're asking if you should walk away £11k up because of their error...

 Are you able to offer any advice ?

The 'advice' is that you're likely to have to pay up so need to start budgeting for it. Do you have the original paperwork to see where the error/misunderstanding came from ?

As a regular of trading in/changing cars there's no way you can honestly 'lose' (or in your case 'win') £11k in a deal without knowing about it ? 

Jenni_D

It might help if you said what was the make/model of the old car and the new car. (Paying less per month when there's a balance owing on the old car doesn't make sense if the cars are similar).

Remember that with PCP you're financing (paying interest on) the whole amount but only making repayments to cover a portion of the amount. That's why there's a balloon payment / outstanding balance at the end of the monthly payment term, where you can either pay it or hand the car back - if the car's value is greater than the amount owed then you get a refund; if less then you have a balance to clear. Did you understand all this when you first took out the PCP on the previous car?

AdrianC

darrendgw said:

so I’m not actually asking if I should walk away with 11k

That's exactly what you're asking.

The correct figures required you to pay £11k to clear the negative equity on your old finance. They have - belatedly - realised that.

That £11k needs to be paid by somebody. Either you pay the £11k or they do.

motorguy

darrendgw said:

AdrianC said:

You PXd your PCP car part-way through the term.
The dealer failed to include the £11k settlement negative equity.
Now they're correcting that error.

That is a VERY big error for them to swallow.
It's also one that, I suspect, would have been very apparent to you if you were familiar with your existing finance package.

No, it should not have got this far. But, basically, you're asking if you should walk away £11k up because of their error...

Hi Thank you.
I am just asking what my options are, as stated had I known that the price would of been 400 a month as opposed to 200 I would of chosen to stay with my old car. I obviously do not want to be burdened with a higher monthly cost now due to their miscalculation.
so I’m not actually asking if I should walk away with 11k . Are you able to offer any advice ?

It may be their miscalculation, but its your debt.

If you find it unacceptable to pay the revised figure and if you'd known what the revised figure would be you wouldnt have done the deal, i'd be proposing they rollback the deal and give you your old car back.

ian16527

'Sorry forgot to add I did not recognise any errors as the monthly payments were very similar '

I have just bought a car via PCP and I understood exactly what my car px was as it was on the order form. Did you not look at this?

Will the garage cancel you agreement and have they still got your other car to revert the deal if possible? I dont know if this can be done. You dont say when this deal started.
Unfortunatey, you owe the money either from the old PCP agreement as you sold a car you didnt own, or you need to finance it now.
Sorry but I think you need to pay somehow or loose the car.

k3lvc

ian16527 said:

Will the garage cancel you agreement and have they still got your other car to revert the deal if possible? I dont know if this can be done. You dont say when this deal started.

Given, according to the OP, the deal started in 2019 I can't imagine (or at least hope) they still have his PX