Unwind PCP agreement within cooling off period

carindividual1

Last week, I went through the process of buying my first car from Cinch, something I'll never do again. However, I purchased the car on finance with a PCP loan. Everything was fine until I received a phone call from Cinch stating that the car would be delayed in delivery due to multiple imperfections, such as rust and a chipped windscreen. I was told these imperfections weren't apparent during the initial inspection.

It took me a day of thinking and weighing my options, and I decided to cancel the car and finance agreement within the 14-day right of withdrawal. I chose this particular car as it was advertised with no imperfections. I felt wronged, and due to it being a distant sale, I'm covered for an unwind with no penalty. I confirmed this with Cinch themselves and my finance company before cancelling the order.

I have received a full refund of my deposit from Cinch within 24 hours of cancelling. I've also received a credit note stating that the refund to the broker has been issued.

This morning, I spoke to my finance company just to make sure everything is progressing as I've had no notification from them. I was told over the phone that to withdraw from the agreement, I'll have to pay the full value of the car. I explained the situation and was still advised that I owe this full amount.

I've since been in touch with the broker who stated that the unwind process is in order and will take time. I'm just really concerned and confused about the situation since the finance company is giving me conflicting information. Essentially, they are trying to get me to pay the full amount when they have already recovered the full value of the car from Cinch.

Stateofart

Are you buying from Cinch, with a PCP from a separate company.  Do they have difference terms and conditions?

Nearlyold

The 14 day right of withdrawal from a finance agreement doesn't cancel the associated purchase, it just gives you the right to withdraw from the finance agreement and repay the lender the amount you borrowed within 30 days of you notifying them, with no additional charges other than  interest for the time the loan was in force.

I suspect you've confused whoever you spoke to at the finance company by referring to a "withdrawal". Where as what you have done is exercised your right to cancel under either the distance selling regulations and or misrepresentation by Cinch.

Dealers and finance companies often don't immediately pay monies owed to each other they might typically reconcile accounts every week or so. 

Is the broker a seperate business  or part of Cinch?

carindividual1

Stateofart said:

Are you buying from Cinch, with a PCP from a separate company.  Do they have difference terms and conditions?

The contract has a 14-day cooling-off period and is covered by the Consumer Credit Act 1974. I also confirmed this with the finance company before arranging the cancellation of the car. All the terms are the same.

I've since spoken to Cinch's finance department, who shed some more light on the situation. The unwind process is apparently slightly different from the right of withdrawal; I guess I kind of jumped the gun with contacting the finance company... For the unwind, I don't need to communicate with the finance company to enforce it, and the cost of the vehicle will be paid back through the broker. They have a relationship with the finance company, and this kind of thing has happened before and apparently takes up to 7 days to finalize, during which my PCP agreement will be terminated without penalty. I just assumed I had to be the one to talk to the finance company.

I'm going to keep an eye on this, though, to make sure everything processes. But it has relieved some of the anxiety for now.

carindividual1

Nearlyold said:

The 14 day right of withdrawal from a finance agreement doesn't cancel the associated purchase, it just gives you the right to withdraw from the finance agreement and repay the lender the amount you borrowed within 30 days of you notifying them, with no additional charges other than  interest for the time the loan was in force.

I suspect you've confused whoever you spoke to at the finance company by referring to a "withdrawal". Where as what you have done is exercised your right to cancel under either the distance selling regulations and or misrepresentation by Cinch.

Dealers and finance companies often don't immediately pay monies owed to each other they might typically reconcile accounts every week or so. 

Is the broker a seperate business  or part of Cinch?

It appears I did that when talking to the finance company. I've spoken to Cinch after posting this and the finance team confirmed exactly what you stated to me here. 

I was told it can take up to a week from the cancellation for the unwind process to finalize so I suspect by this time next week everything should be settled but I'll keep an eye of the situation daily