Cancelled credit agreement for warranty

descriptivebeefjoint

Hi, 

I recently cancelled a credit agreement for a car warranty I had. I was making the payments via a 3rd party agency (let’s name them Peter) to an extended warranty company (let’s name them Toby)

I (partially unintentionally) cancelled my credit agreement with Peter after making 10/12 payments. They then said I no longer owe them any payments due to the agreement being cancelled.

However, after a long and tedious chat with Toby, I’m no wiser at understanding where I stand. Toby has said that I still owe the outstanding balance of my agreement plus a cancellation fee to them.

Isn’t my agreement with Peter, who said I owe nothing, not Toby? I have paid the cost of the policy plus a little bit more, but not the full amount I was due to pay including interest to Peter. 

I was under the impression that the purpose of my credit agreement was to pay the warranty company in full (payment made by Peter) then I pay them back?

Toby has also said if I don’t settle the outstanding balance plus cancellation fee to them, that it will affect my credit score.

Thanks

Nasqueron

If it's a credit agreement, sounds like the middleman Peter is simply passing the payments on - your agreement could be with Toby and if they expected 12 payments, then whatever Peter says is irrelevant - yes a defaulted payment could be reported on your credit file (not score)

Hoenir

There's two transactions here. You purchased a product from Toby but asked Peter to pay the money across on your behalf on the understanding that you would pay them back. Peter duly did so. You've told Toby you no longer require the product. Toby says fine, doesn't bother them as they've been in full.

You stop making payments to Peter. As a result Peter is out of pocket. As there's no refund from Toby. They've incurred all the admin costs , incurred interest on advancing money on your behalf. Fortunately they've a legally signed contract which contains detailed terms and conditions. These can be used to recover any unpaid monies from yourself. As a finance house they'll be fully equipped to take whatever action is required to recover the monies at your expense. Likewise as any good business will do. They'll share the default to warn others of what's happened.