New Car PCP - Agreed February, Car Delivered, Dealer now insisting on New % Rate Set at Huge Cost.

Grumpy_chap

The EQS was under £100k at the beginning of the year and starting price is somewhat higher now

jumeriah64

MrFrugalFever said:

Speaking from a dealer perspective, in my experience a finance campaign will often run 3 months at a time (quarter) and in most instances will be honoured for 2 quarters due to the extended period in which cars are taking to be built & delivered. However, this is often an agreement between the finance house and manufacturer.

The cost of money has significantly increased since February and it would be quite unusual for the finance company to go back to a campaign that was from 3 quarters ago. When campaigns are fully removed by the finance house there is generally no way of retrieving it back. An expired campaign such as one which was from the previous quarter is normally able to be manually retrieved (again, only talking from my own perspective).

A credit acceptance is generally 90 days, after which a further hard credit search will need to be carried out. The finance docs supplied (if supplied early) should provide you with a PCCI (pre-contract credit information) document and a SAA (Sales Agency Agreement). The SAA will outline if any change of rates/offers etc are variable at any point.The finance house CAN unwind the deal, reject the deal and refuse the deal even AFTER signing the documents. I have had a customer to all the way through proposal, acceptance, signing to be stopped at the funding payout stage as a refusal to fund because of a technicality, meaning a new car couldn’t be registered until that was resolved. It happens unfortunately.

Your supplying dealer will not want to lose the sale so I am sure they will be on YOUR side, however, it may require you to raise a complaint with the underwriting team of the finance house involved, CC’ying the supplying dealer and its finance manager in to the complaint.

Many thanks for taking the time to explain this.

This very much sounds like our situation and the conversation we heard from their finance guy.

Essentially his very confident and well explained take on it was that a certain code had to be obtained. This code was requested from the manufacturer finance group for the UK. If I understood correctly, a campaign would then be created (in this instance for me and my specific purchase) then when the code is obtained, it took another 48 hours for it to be implemented. Then at that point we could complete the necessary transaction.

The explanation was very complete and very understandable. And I do believe that it was accurate. He gave the very clear message that this can happen and that they had done this process many times and always with success. He did also say that the process was very manual, somewhat IT based, a little archaic and that they (the dealership) had very little to no leverage to speed it up. We accepted that in good faith and agreed to wait essentially 7 days to allow them to sort everything with the car and paperwork. There was absolutely no indication that there could be a risk or anything other than a solid and clear outcome. I do seem to recall him saying something similar to your comment ... I think the campaign had literally just expired. But just being enough to cause us a problem.

When I got the call explaining what the finance group had done, I did get the impression he was genuinely shocked at the outcome. He said he had 20 years worth of experience in this field and that was the first time this had ever happened.

The sale is for near on £130k. An outrageous amount I know but I've been fortunate enough to have had company cars until the tax regs made it near worthless to do so a few years back ... for me anyway. Even more outrageous, this is the first car I've ever ordered/bought in my own right at 58 years old. It's a flagship model and optioned up for us specifically but would be a very easy sale for them should the worst happen. It was even suggested by the dealership that it is such short supply that we have already made money on it residual wise within the PCP. Whether that is true or not I don't really know. I tend to think it may well be.

There did seem to be genuine frustration from the finance guy in particular. He has promised to escalate it to decision makers. The discussion was a very civilised one and I get the clear impression he agrees we have done more than everything by the numbers ... even to the point of emailing the dealership twice whilst away asking if there were any paperwork, authorisations or money required to keep this moving. There was no indication that anything other than waiting was needed on our part. Whilst the conversation was civilised and I stressed we need to work together, I also very gently made it clear the lengths I'm prepared to go to get a hearing and visibility on this issue. I think we understood each other well.

Is very good advice you mention and I absolutely will do that once we get feedback this week. So frustrating ...  the car sits there perfectly valeted, PDI'd, with our selected number plate. The app on my phone shows me everything they are doing to it / with it. 

Not the greatest purchase experience I've had.

macman

I still don't understand why you don't read your finance contract and see what the terms say. It must be clear: either there are circumstances under which they can increase the rate, or there aren't. If there aren't, then they must either honour the contract or you can sue them for breach. I would have thought that the most likely get-out is a time limit, maybe 90 days from signature of finance to supply?
I cannot believe that such a contract is not drafted in such a way as to make it totally unambiguous when dealing with loans of this value. 
If the car is already reg'd in your name then the dealer has a real problem, as if you can't purchase it, he can only resell it as a used vehicle.

MrFrugalFever

I do hope that an element of goodwill and kindness comes in to play here on the part of MBFS.

Unfortunately, lenders can (and do) withdraw offers at their own leisure, often without notice. Recently a gentleman who applied for a personal loan was accepted, requested amount of borrowing and at the advertised rate - for it to then be pulled and reversed saying they could no longer offer this deal.

The bit that works in your favour is the fact that the delivery timescale of your vehicle is well outside of your control. MB will need to agree with MBFS on how to proceed and essentially who foots the bill.

jumeriah64

macman said:

I still don't understand why you don't read your finance contract and see what the terms say. It must be clear: either there are circumstances under which they can increase the rate, or there aren't. If there aren't, then they must either honour the contract or you can sue them for breach. I would have thought that the most likely get-out is a time limit, maybe 90 days from signature of finance to supply?
I cannot believe that such a contract is not drafted in such a way as to make it totally unambiguous when dealing with loans of this value. 
If the car is already reg'd in your name then the dealer has a real problem, as if you can't purchase it, he can only resell it as a used vehicle.

I fully agree and as mentioned in reply to another post, we will surely do that. No doubt. Not disagreeing your opening point.

But I don't think it is quite as simple as it might first appear.

As I've explained a couple of times at some length, there are procedures and regularly done adjustments at the dealer finance level (to and with the finance group) that confirm that this work round is not just a one off but a regular one. And I imagine for precisely this reason ...  maybe were an agreement has been exceeded or time has passed by and they simply revive the proposal by implementing the steps I mentioned earlier.

I would say that this has been happening for a long time but that the only thing that has changed is the size of the rate hike. Maybe that causes these regularly done admin changes to be reviewed or now refused? The size of the hike was mentioned but I forget the number this second.

I don't know that for sure but it sounds a possible. 

The car 100% has my name on it. I was sent the factory build and shipping plan. But I sort of doubt it would cause too much hardship at the dealership to change that. In the best possible way I hope it does of course :-:wink:

We are into the dark side of the last standing informal adjustments made on a formal agreement. A formal arrangement I suspect will be fairly tight. But the admission was also equally clear that they have had back doors and ways of changing PCP parameters that have worked but in this instance, are not doing so. As they said, it's the very first time they saw this refusal.

jumeriah64

MrFrugalFever said:

I do hope that an element of goodwill and kindness comes in to play here on the part of MBFS.

Unfortunately, lenders can (and do) withdraw offers at their own leisure, often without notice. Recently a gentleman who applied for a personal loan was accepted, requested amount of borrowing and at the advertised rate - for it to then be pulled and reversed saying they could no longer offer this deal.

The bit that works in your favour is the fact that the delivery timescale of your vehicle is well outside of your control. MB will need to agree with MBFS on how to proceed and essentially who foots the bill.

Yes me too. I'm not a car guy but this was pretty much the first thing in a long time that caused us to raise and eye brow and interest. 

The service and support has been shockingly average if I'm honest. The CS and experience in general likewise. But the hard product is pleasing and I do want it. Not at any cost and not at the increasingly miserable experience.

Interesting point you make on lead time. We were very flexible and this thing was not supposed to land until December. We (and the dealer) have no real idea why it arrived 6 weeks early. Had we have had any clue that an arrangement was about to expire, we could have easily completed the arrangement and payment. But no indication at all was ever made that this could be a risk.

Will keep the thread posted with progress. If some human consideration comes from the dealer MBFS and MB UK then super stuff and it should be positively commented on. This is far preferable and very my way of doing things and indeed the decent way to do things.

Should it fail to, then the full details, paperwork and story will be made very public indeed. Company I work for has first class and very active marketing, PR and media channels into many well positioned publications and indeed mainstream TV channels. Not my style to publicly bellyache in such a manner but I do have a powerful toolset and keys to those who know how to do such things very well indeed. 

MrFrugalFever

It’s a real difficult one, I believe that it is highly likely due to the timescales involved that MBFS have wiped any campaign that existed when you ordered the car, thus when your supplying dealer tried to re-initiate it (which would incur another hard credit search) they were simply unable as it just does not exist. It would then be down to a specific team within MBFS and their underwriters to effectively decide if this can be re-opened or if it is simply dead in the water. 

I would urge that a fair and concise email is written, outlining events, to both MBFS and the supplying dealer to appeal to their goodwill for resolving this issue.

Interestingly, I wonder if the same scenario would stand had you of paid for the car outright - I suggest it wouldn’t as the cost to the lender is then irrelevant but simply a case of MBUK price honouring the deal.

The gripe needs to be very much firmly weighted towards MBFS, especially given how much interest your agreement no doubt makes them!

Dave_5150

When I ordered my car last October we agreed a discounted price for the new car, an amount of equity in my p/x vehicle over the settlement figure and I signed the finance contract at 3.9% APR that day. 

I took delivery this March and everything went as expected despite the new car increasing in price, and their published finance rate increasing. If they'd tried to change the deal I'd have walked away. (Mazda BTW).

jumeriah64

Dave_5150 said:

When I ordered my car last October we agreed a discounted price for the new car, an amount of equity in my p/x vehicle over the settlement figure and I signed the finance contract at 3.9% APR that day. 

I took delivery this March and everything went as expected despite the new car increasing in price, and their published finance rate increasing. If they'd tried to change the deal I'd have walked away. (Mazda BTW).

And this was absolutely the clear message we were given in a similar manner but on an item with a much longer lead time. There was and still is, no opportunity for discount on this type of vehicle. It will come but no time soon.

Your experience is as you might expect ... there were no interest rate changes and none anticipated. And then a new PM to replace a lying PM, a set of insane policy decisions and a 50Bn hole in the Uk finances later ......

I understand the issues regarding product lead time and it was not a huge issue for us. 

Walking away of course is indeed an option. I'm not a car guy or have a huge amount of interest in the main. That said, walking away still means increased rates on different options elsewhere. And if I'm honest, there's little else (currently) that blows my skirt up right now .... just a load of dull  Euro boxes in the main and of course in my opinion. This one did interest. 

k3lvc

Dave_5150 said:

When I ordered my car last October we agreed a discounted price for the new car, an amount of equity in my p/x vehicle over the settlement figure and I signed the finance contract at 3.9% APR that day. 

I took delivery this March and everything went as expected despite the new car increasing in price, and their published finance rate increasing. If they'd tried to change the deal I'd have walked away. (Mazda BTW).

And this is exactly how I'd expect it to be - but then in the last 20-30yrs of car buying maybe we've never had such situations of inflation/interest rate changes and have become complacent about our 'expectations' becoming 'norms'

Will be interesting to see what @jumeriah64 order/contract says and whether MB have pre-empted changes and updated their order form allowing changes to be made (and if so under what circumstances)