Unusual request regarding using credit card to make final payment on PCP finance

MarkMTH

I am coming to the end of my PCP and have decided that I want to keep the car. The final payment is reasonable and the car's value means it makes sense. 

However it is still a lot of money to find (over £4k) so I planned to use a credit card and !!!!!! it to a newly obtained Nat West 33 month 0% balance transfer card.  

I have contacted FCA Automotive Services (Fiat finance) to discuss this and got this really unusual response! I wondered if anyone could shed light on why they are asking this and whether this is commonplace? Whether it is normally a case by case basisc for such decisions (affordability maybe?) Or if there is something else going on here more sinister, like agreements between them and other financial organisations? 

Here's their reply to me: 

Dear Mr ********, 

Thank you for your e-mail. 

I have checked the agreement, I can confirm your final payment is due to be taken by Direct Debit on February 15th. The amount is £*******.

We accept payment by Bank Transfer, Cheque and Debit Card, I have also attached our bank details.  

If you want to make payment by Credit Card, this is reviewed on a case by case basis. Is it ok to ask what type of Credit Card you have, is it 0% interest and do you earn any points/rewards using it? 

Should you require anything further, please don’t hesitate to contact us on the details provided below.

Kind Regards,

Marc *******

Customer Care Specialist

FCA Automotive Services UK Ltd
250 Bath Road, Slough, Berkshire,
SL1 4DX, United Kingdom

CliveOfIndia

It does sound a little unusual, I'll admit, for them to ask that - they'd normally say "yes we accept credit card payments" or "no we don't".  It's not uncommon for any merchant to be "wary", as it were, of credit card payments, simply because of the merchant fees they'll have to pay.  Maybe they don't normally accept CC payments, but may do so on odd occasions if they think there's a chance of some repeat business?

Personally, I'd be more worried about whether your credit card would class this as a cash advance - with associated fees and interest.  It's not uncommon when trying to use a credit card to pay off another form of credit.

gizz_10

Interesting - I bought a car in Oct and just paid the PCP all off using my Virgin rewards credit card to get the points - and then did exactly what you are doing - transferred to 0% BT card with RBS.  Mine was Kia finance administered by Santander Consumer Finance and the only thing they said was - we don't charge if you pay by CC but your CC provider might.  It all went through with no issues - no cash advance or other extra charges from Virgin either.
It seems weird that they would ask if you get points or 0% though - unless they would levy a charge on the basis that you are moving to 0%?

TadleyBaggie

When I wanted to pay off a PCP a few years ago, they (RCI) wouldn't even accept debit cards. Had to do it by bank transfer.

Marchitiello

It sounds like the case to case basis may be a bit of a trap. They may not actually want to accept cards but may do so if one has special circumstances, which could mean they see favourably the fact you may have a 0% card.. on the other hand they may instead be looking to offer you another finance deal to break down that £4000 in 12/24/36 months or whatever, so they would potentially be more understanding if one did it for the points/rewards.. I would be tempted to reply that it is a better way for you to manage your finances on that particular month and that you have a regular Credit Card. 

MarkMTH

I asked them why they wanted to know the details and they replied with this: 

Thank you for your e-mail.

The reason for the questions regarding your Credit card, is that we don't normally take this type of payment. If you do want to pay by Credit card, we have to review the details with our management team before taking any payments

I understand that but I still don't understand why they asked about rewards, points and interest rates.  

 

SusieT

It could be that they would get a kick back if they were to finance the car for the £4000 but if you were to get points or 0% interest they could not offer that as it would mean getting you into a higher amount of debt than were you to use the card? 
As above though, make sure the card issuer would not class it as a cash transfer and add fees or extra interest

born_again

MarkMTH said:

I asked them why they wanted to know the details and they replied with this: 

Thank you for your e-mail.

The reason for the questions regarding your Credit card, is that we don't normally take this type of payment. If you do want to pay by Credit card, we have to review the details with our management team before taking any payments

I understand that but I still don't understand why they asked about rewards, points and interest rates.  

 

Given that, they are looking at the risk of a default for non payment. The greater the risk, the more likely to allow a CC payment to get rid of the risk.

Paying credit, with credit is never looked on well by lenders, as it is a warning sign of trouble going forward.

Yes I know people do it as they can get 0% interest. But it stands that you should always be planning to be able to pay off a long standing facility such as a car payment, without having to use further credit.

martinbainbridge1975

None of their business, as above they either accept credit card or dont. The wording could be interpreted as slightly discriminating 

bsms1147

Hard to guess whether 0%/cashback/points would be seen as a positive to them (and more likely to accept a credit card payment) or a negative (and less likely to accept).

Fascinating!

MarkMTH

So thank you all for your comments. 

Couple more vaguely worded replies from them but their systems were back online yesterday so I was able to call and discuss it.

They still claimed it was more of a responsibility thing but never gave a straight answer when questioned what the rewards / points element.  They passed to a manager who authorised the payment, so sorted. 

I still have my doubts about their motivations though.  

Thanks.