Excess mileage enforceable?

flashg67

Looking at the extreme view, you sign up for 5k miles per year then do 50k per year, so devaluing the car massively against the expected residual value that the lease is based on and expect that will be ok.....? Finance companies aren't stupid and it's unlikely this eventuality hasn't been covered in the 60 years or whatever that car leases have been a thing, and on the assumption the vast majority pay their excess mileage or there wouldn't be such a thing as a lease, personal or corporate

DullGreyGuy

Geranium44 said:

There’s no provision for excess mileage charges in the law, so in theory, you can’t be charged for exceeding your mileage allowance. 

There are billions of types of transactions that there is no explicit law for... there is no law that says if you book an airline ticket that allows you 2 hold bags at 15kg each that if you turn up with 3 hold bags at 20kg each that they can charge you excess luggage. No law says that if you ask them to polish your shoes after resoling them that they can charge you the £10 fee for polishing. 

Thankfully in English law we have the concept of a contract which enables parties to agree such things between themselves. An airline can sell cheaper tickets by offering limited luggage and the customer has the choice to buy that or pay more for more luggage, works for both sides. 

If we didn't have such concepts then most would have to be charged more because declared mileage has no meaning anymore and the total mileage driven in lease vehicles would likely increase (I know I reduced my mileage in the last few months when I was getting close to the limit before handing back)

jlfrs01

motorguy said:

jlfrs01 said:

I took the decision not to pay BMW Finance for excess mileage I'd incurred, their response was immediate and robust. I dug my heels in and it dragged on for several months until I realised that because I'd not paid, the contract was showing as a default on my credit record. I only found this out when a mortgage lender reduced the amount they were willing to lend against a property I was planning to buy. Furthermore, when I returned to BMW Finance a few years later for another PCP contract my application was declined so I'd obviously been blacklisted.
Honestly, if you've gone over your contracted mileage it's best to take it on the chin and pay up, after all you'd have paid it anyway as part of your monthly direct debit if you'd taken out the PCP with higher mileage stated from the outset.

Worth noting this is a Contract Hire agreement in question, not a PCP.

So basically a long term car rental.

Noted though PCH and PCP agreement both include mileage allowances. I found some information online to share which may shed some light, admittedly it's themed around VT but does cover the legal aspect of mileage in contracts:

https://www.thecarexpert.co.uk/car-finance-voluntary-termination-pcp-hp/2/

Car_54

jlfrs01 said:

motorguy said:

jlfrs01 said:

I took the decision not to pay BMW Finance for excess mileage I'd incurred, their response was immediate and robust. I dug my heels in and it dragged on for several months until I realised that because I'd not paid, the contract was showing as a default on my credit record. I only found this out when a mortgage lender reduced the amount they were willing to lend against a property I was planning to buy. Furthermore, when I returned to BMW Finance a few years later for another PCP contract my application was declined so I'd obviously been blacklisted.
Honestly, if you've gone over your contracted mileage it's best to take it on the chin and pay up, after all you'd have paid it anyway as part of your monthly direct debit if you'd taken out the PCP with higher mileage stated from the outset.

Worth noting this is a Contract Hire agreement in question, not a PCP.

So basically a long term car rental.

Noted though PCH and PCP agreement both include mileage allowances. I found some information online to share which may shed some light, admittedly it's themed around VT but does cover the legal aspect of mileage in contracts:

https://www.thecarexpert.co.uk/car-finance-voluntary-termination-pcp-hp/2/

It "covers" the legal aspect by making totally erroneous statements. This advice has already been demolished by DullGreyGuy above.

MacPingu1986

jlfrs01 said:

Noted though PCH and PCP agreement both include mileage allowances. I found some information online to share which may shed some light, admittedly it's themed around VT but does cover the legal aspect of mileage in contracts:

https://www.thecarexpert.co.uk/car-finance-voluntary-termination-pcp-hp/2/

The link above is wrong - English law doesn't need to have express rules around mileage allowances for them to be enforceable.

The legal position is fairly straightforward. It's a contractual term that the parties agreed to when they signed the contract and is enforceable. Consumers can challenge contractual terms in certain circumstances under consumer protection legislation, but this would only really be applicable if the excess mileage charge was so high as to be *completely* out of proportion.

As a basic principle, excess mileage charges are enforceable.

tifo

Our financed cars have excess mileage after a few years. We don't give them back but sell them, pay the finance off and buy another one. There's no issues.

motorguy

jlfrs01 said:

motorguy said:

jlfrs01 said:

I took the decision not to pay BMW Finance for excess mileage I'd incurred, their response was immediate and robust. I dug my heels in and it dragged on for several months until I realised that because I'd not paid, the contract was showing as a default on my credit record. I only found this out when a mortgage lender reduced the amount they were willing to lend against a property I was planning to buy. Furthermore, when I returned to BMW Finance a few years later for another PCP contract my application was declined so I'd obviously been blacklisted.
Honestly, if you've gone over your contracted mileage it's best to take it on the chin and pay up, after all you'd have paid it anyway as part of your monthly direct debit if you'd taken out the PCP with higher mileage stated from the outset.

Worth noting this is a Contract Hire agreement in question, not a PCP.

So basically a long term car rental.

Noted though PCH and PCP agreement both include mileage allowances. I found some information online to share which may shed some light, admittedly it's themed around VT but does cover the legal aspect of mileage in contracts:

https://www.thecarexpert.co.uk/car-finance-voluntary-termination-pcp-hp/2/

Different thing entirely.

The reason its hinged around VT is because the purpose of VT was to allow someone with a HP agreement the ability to walk away "with nothing further to pay" when they had paid 50% of the total agreement amount.

PCH doesnt have that VT capability, so there is no point to argue.

PCH is a car rental with an agreed, and legally enforcable excess mileage clause that the hirer signs up and agrees to.  

IF they decline to pay the hiring company WILL bill them for it, if not paid the hiring company WILL pursue it and if it goes as far as court they WILL win.

There is no "ah buts" because of VT on a PCP agreement - its a different thing entirely.

motorguy

tifo said:

Our financed cars have excess mileage after a few years. We don't give them back but sell them, pay the finance off and buy another one. There's no issues.

Completely irrelevant to the point in hand as its a PCH / lease deal, therefore the hirer doesnt own the car, cant sell it at the end of term and MUST pay any excess miles charges and any damage about fair wear and tear.

Grey_Critic

Quite funny really - People are happy to sign a contract at the beginning with no thought about the T&Cs yet when it comes to the end they claim it is unfair.

DullGreyGuy

Grey_Critic said:

Quite funny really - People are happy to sign a contract at the beginning with no thought about the T&Cs yet when it comes to the end they claim it is unfair.

Given most sign without reading its kinda of understandable... now those that apply for a loan and years later say that the loan should never have been given to them and so want compensation take it to another level in my opinion