Mis-selling of PCP (Mis-sold PCP)

hangermanj

Hi All

I wonder if you can help me here. I see a few feeds re: Mis-sold PCPs etc (Car Finance Agreements) 

I have a few questions. 

The first is that I used the template letter on MSE and sent it in good time before my contract finished however just last week the lender (in this case SEAT/VW Financial Services) point blankly refused any of my issues regarding the possible mis-selling of car finance and offered no compromise. They even said that my letter didn’t specify mis-selling. However I used a number of points on the templated letter, including extra interest added by the dealership through, the affordability checks done at the time, and more. 

USING THE MSE MIS-SELLING TEMPLATE
So first question is. Is this what all the finance companies do - Do they just ignore your complaints as you are the “small man” or “small woman“ with no powerful organisation behind you?
AND Has anyone had any joy with this issue using the MSE claim template?

PCP MIS-SOLD PCP CLAIM COMPANIES
Can anyone recommend a decent one that charges less than 40% plus VAT and additional fees? As around 40% is an exploitative fee.
I really would love an organisation who are reliable but not too expensive. RECOMMENDATIONS PLEASE

Many thanks

Jason

MrFrugalFever

I’d love to know how you think you’ve been ‘mis-sold’ a PCP agreement!

[Deleted User]

Templates rarely work, because they effectively say 'I don't know what my complaint is, but maybe it's in here somewhere, so please can I have some money'.

Just submit your own complaint, specifying the issue.

The_Fat_Controller

Please do tell us exactly why you think your contract was mis-sold.

hangermanj

Thanks for the responses.

I believe that there was an error when the finance agents (SEAT/VW, and the dealership), authorised the loan, as I realised that as I had a large loan already in place (with a third party-unrelated to this) before the car agreement was taken out. This situation meant it was particularly difficult for me to pay both loans side by side. Also, I tried at the time to get the interest rate out at the advertised one at the time, however, after closer inspection (and my error here) noticed it was 7.7 % apr, and not 4% that the car company was advertising at the time.

If I write again to SEAT/VW financial services, what do you suggest i use as the mis-selling argument? The adverts promoted on this issue keep say that the dealership is adding their own commission on the loans, but I welcome your constructive thoughts.

Basically my issues are.
1. The higher interest rate than the nationally advertised rate
2. Affordability due to already having a loan in place, when taking on this new debt for the car
3. The balloon payment that is due soon, I cant afford - Due to recently being made redundant.

Help please

Thanks

Jason

MrFrugalFever

How long ago was this?

It was not down to the dealership or individual selling you the car to determine your level of affordability UNLESS, you explicitly said during the process that you do not believe this to be affordable with your known levels of expenditure of where displaying signs of mental incapacity. Good luck trying to prove a record of conversation here.

If VWFS have conducted a hard credit search and deemed that you were eligible for the secured finance loan then they would have had to complete an affordability check. Did you mislead the dealership in anyway with regards to income and expenditure?

If you knew it was unaffordable, why did you continue to pursue the finance and car purchase?

The APR rate could have changed due to your affordability assessment, however, that is highly unusual on secured finance as normally the rate advertised is a set campaign between finance house and manufacturer. Are you sure you’re not getting mixed up with the 7.7%Apr being the headline rate and the 4% being the ‘fixed’ rate?

YOU signed the credit agreement and would have been provided the SECCI prior to actually signing.

I don’t believe you will get anywhere with your claim.

The_Fat_Controller

1. If the advertising said that XX was the only rate available you may have a case, most deals give indicative rates. 
Highly unlikely to have any case here especially as your signed the paperwork at 7.7%

2. Your choice taking on the extra loan and you must have passed the credit check.
If it really wasn't affordable why did you take it ?

3. No chance of any redress here, balloon payments are an integral part of the contract you agreed to.

No commission is added to your loan.

Unfortunately it looks like you'll just have to hand the car back, one of the two choices on a PCP agreement and hope you aren't penalised for too much damage.

MrFrugalFever

Also, commission is NOT added on to the loan, a set rate is agreed between manufacturer backed finance house and dealership group, regardless of APR on a brand new car registration (even prior to Jan 21 FCA changes).

If finance is refused by the main manufacturer finance house, so in this instance VWFS, but you are then proposed elsewhere, say Close Brothers, for example, get accepted but at a higher rate then a separate commission scheme may well apply and yes, it is likely the dealer will receive a greater amount of commission off the back of a higher APR.

[Deleted User]

hangermanj said:

Thanks for the responses.

I believe that there was an error when the finance agents (SEAT/VW, and the dealership), authorised the loan, as I realised that as I had a large loan already in place (with a third party-unrelated to this) before the car agreement was taken out. This situation meant it was particularly difficult for me to pay both loans side by side. Also, I tried at the time to get the interest rate out at the advertised one at the time, however, after closer inspection (and my error here) noticed it was 7.7 % apr, and not 4% that the car company was advertising at the time.

If I write again to SEAT/VW financial services, what do you suggest i use as the mis-selling argument? The adverts promoted on this issue keep say that the dealership is adding their own commission on the loans, but I welcome your constructive thoughts.

Basically my issues are.
1. The higher interest rate than the nationally advertised rate
2. Affordability due to already having a loan in place, when taking on this new debt for the car
3. The balloon payment that is due soon, I cant afford - Due to recently being made redundant.

Help please

Thanks

Jason

You are misunderstanding the scam/grift from the adverts. The adverts falsely claim dealers deliberately inflated the interest rate you were offered to ensure they got higher commission, whereas in reality this almost certainly never happened. Even if it did, how would you prove they deliberately increased the rate vs that was the risk profile?

The fact you already had a large loan actually ties in with the higher rate - they credit checked you and considered you more of a risk due to your existing debt so increased the rate you were offered to cover their own backs. The fact you didn't read it is your own mistake but a headline rate of 4% and you getting 7.7% is completely legal, representative rate only has to be offered to 51% of successful applicants. Why did you suddenly remember you had a large loan, how could you forget that? If PCP was unaffordable, why did you take it rather than buy a cheaper car?

You can't keep rewriting to Seat making new allegations based on what you read online might apply to you, you need to be factual about why you feel it was miss-sold and in this case, they said no because they feel you were not.

Lastly, the balloon is a standard part of PCP, you were not miss-sold it. You either return the car and hope the car is worth the same (or more) than the balloon, sell the car to someone like WBAC (who pay off the finance and you any balance or pay up) or pay the balloon.

I would suggest you read stuff before you sign it in future, it could avoid very expensive mistakes

mcpitman

hangermanj said:

Thanks for the responses.

I believe that there was an error when the finance agents (SEAT/VW, and the dealership), authorised the loan, as I realised that as I had a large loan already in place (with a third party-unrelated to this) before the car agreement was taken out. This situation meant it was particularly difficult for me to pay both loans side by side. Also, I tried at the time to get the interest rate out at the advertised one at the time, however, after closer inspection (and my error here) noticed it was 7.7 % apr, and not 4% that the car company was advertising at the time.

If I write again to SEAT/VW financial services, what do you suggest i use as the mis-selling argument? The adverts promoted on this issue keep say that the dealership is adding their own commission on the loans, but I welcome your constructive thoughts.

Basically my issues are.
1. The higher interest rate than the nationally advertised rate
2. Affordability due to already having a loan in place, when taking on this new debt for the car
3. The balloon payment that is due soon, I cant afford - Due to recently being made redundant.

Help please

Thanks

Jason

Wow, you really do have buyers remorse don't you. You even admit in the first paragraph that you know you couldn't afford this commitment when you took it on.

1. You did know that though didn't you, at the time of purchase, because you were expecting to pay £x p/m then the quote came through at £y p/m.
2. Higher risk = higher rate, maybe you couldn't afford that shiny new car you signed up for?
3. Ok so you took on a PCP, worked out the monthly payments, but never thought about what those payments add up to? Balloon payments are as common to car finance as a deposit is for a mortgage.

Why don't you stop chasing for compo and look at yourself.

superbigal

I think most PCPs headline with fixed interest rate and then also mention representative APR.
Very easy for 4% of the former to actually be 7.7% of the latter.

I'm currently viewing a deal that describes 49 months 3.04% Fixed which turns into 5.9% APR.