Help! Car dealership delay leads to default

HT_Harry

Hi, firstly apologies as this type of query has probably done the rounds multiple times (I'm panicking).

I've had a finance agreement with the company for 4 years. Coming to the end of the agreement I visited the dealership and agreed to a replacement car. Typically due to stock levels was told there would be a delay till next year and that they can extend my finance agreement. The order form was signed following this and so I waited.

Having had a wobble because I'd not heard anything regarding the finance - I called the finance arm of the company and was told be a balloon payment had already been requested for a settlement and it was unfortunately too late to cancel!? This was money I don't have in my account so the panic begins.

I contacted the dealership and was told that this should have been sorted (I'm part exchanging the vehicle for the new one). I mentioned my credit rating (which I was proud of) and told it would not impact it and told to cancel the direct debit. Following this and attempt at the settlement and and additional £10 was paid. The following day my statement has a +figure for the settlement and £10 (no idea why). Since then I signed a new agreement/direct debit which should kick in this month.

I'm about to request a loan for home improvements and done a soft search - nope not going to happen as my rating has been hit. 

I had an excellent rating and now it's poor (never missed a payment to them or anyone else - clear my cards, etc.). I've emailed the dealership and asked for a letter of liability. I've raised dispute with Trans Union and will do so with Experian (bigger points drop) and Equifax (not come through yet and annoyingly top score).

So really not sure where to take it from here - total layperson. I have emails from the dealership who are stating they should have dealt with it. I think I had too much trust in the process and had a belief that it should be plain sailing seeing as it was a straight swap and the brand is the same as their finance arm. Why would I settle a car that has been agreed to be part-exchanged? *sigh* Ironically - unless it's fixed - they may even reject the new agreement on the next car due to the credit rating! Really can do with some advise please - it's been an eye opener for sure...

Thank you

HT_Harry

Apologies - not sure how I ended up in "debt free wannabe" Will see if I can remove.

SaverRate

Im confused, so you signed a new finance agreement. Surely this will mean you will be credit checked? 

Your credit score is irrelevant its your credit history thats important. 

Are you sure your were rejected for the home improvement loan because of the car finance? It could be you didn't fit their customer profile

BJV

Ok - ask your dealership's finance manager to call the finance company. They will have account managers etc who will have more sway than you and I. They should be able to remove it. They were the ones who recorded it. ( a few years ago a bank recorded something against me incorrectly and they removed it ) 

Send off the evidence to credit reference agencies.

However, please remember It can take 6 - 8 weeks ( sometimes longer ) for your report to adjust even when they change it. Also please remember that as you have applied for another loan ( extension ), this will impact your credit score.

HT_Harry

Hi BJV,
Thank you for your prompt input, much appreciated.

I'll go beyond the Senior sales rep and ask for a manager's name. Funny how quickly he'd respond to me prior the sale. He was the rep that arranged my previous car 4 years ago so I've dealt with him before for what it's worth.

Really very frustrating - I would have been better off getting a loan to buy the car and sell it (seeing as thanks to lockdown - I've used it very sparingly) but thought due to so much going on personally, I'd take the quicker route, alas.

When you see evidence, I've sent my reason and hopefully can get this letter of liability I've asked for.

One side of me tells me to cancel my order and go to another brand but no doubt - that will work against me and they'll be less forthcoming (plus I like the brand and car).

Yep - seen the turnaround time. Really bad timing as I needed to take out a loan. It's really amazing how I can go from such a good rating to such a poor one based on one hit. I do know that clearing credit cards, etc. does me no favours but I hate paying interest. Fortunately, we renewed our mortgage this year and for 5 years (need to find something positive in all this).

If only I could find someone who only uses Equifax for searches before they update! 

Thanks again

Nasqueron

The "good" and "poor" ratings are made up nonsense, nobody sees them but you, don't worry about them

Ensure the firm removes any incorrect data like defaults - threaten with ICO if they pretend they can't

HT_Harry

Thanks Nasqueron,

I tried a soft check with Tesco for a loan and that was refused (or advised it was likely to be) - no way would it have been before. It does feel nonsense in the sense someone who has had an excellent record prior to this can all of a sudden become a risk due to one missed payment (in 48).

I did ask for the finance manager's name and the sales rep responded with a quote (assume from finance) that it wouldn't show on my report so soon and if it does, they will write to them. Well, I've told them it is showing!

Wife is telling me off because I'm too softly softly with them and I need to be more demanding (probably true). I know it's not one of my strengths unfortunately. 

HT_Harry

SaverRate said:

Im confused, so you signed a new finance agreement. Surely this will mean you will be credit checked? 

Your credit score is irrelevant its your credit history thats important. 

Are you sure your were rejected for the home improvement loan because of the car finance? It could be you didn't fit their customer profile

Apologies SaverRate, didn't see your post.

Yeah, I'm a bit miffed. I cancelled the direct debit and was sent a link for the next finance agreement (for the extension and not the new car). All sorted as far as I'm aware (albeit now I'm worried and will check) - this was before I was aware of the default showing on my report.

The refusal is no doubt in my mind based on the default/missed payment. It's not a silly amount (albeit that might be subjective) and I'm forever getting loans pushed in my direction by my bank, etc. It is an assumption though. But I will try a soft check with another loan company now you mention it.

Thanks

HT_Harry

@SaverRate The extension (finance application documents) were signed on the 27th last month. The loan is for the settlement value of the current car with the same payments. I have an agreement number and a copy of the direct debit form for the bank. it does say the first payment is usually around a month after the doc is signed so assumedly, this is fine. It isn't showing under the direct debits section on my banking app but presume that's because it's not been called for yet.

I think this whole experience has rendered me stupid and question what is probably obvious...

SaverRate

You should never cancel a direct debit thats to pay for finance/loans etc. That is a sure fire way to result in a default. 

enthusiasticsaver

Any defaults will need to be removed by the finance company so you are at their mercy. I hate that way of financing cars and would rather buy with a personal loan where you are in control rather than a finance company. Unfortunately you will need to persist to get your credit record changed but it will take time and if you need finance for home improvements I would delay as the chances are you will be refused.