Car Rejection with Negative Equity PX

gc7

Advice sought for a matter I'm going through right now. key points noted below:

I purchased a car from Arnold Clark on 19/11/24. This involved trading an older car, with a PX value of at £12,000 and finance settlement of £13,000. A negative equity of £1,000. The new car was also purchased on finance.

Immediately on leaving the forecourt, some minor issues were noted such as tyre pressure warnings coming on and parcel shelf ill-fitting. After a few days we experienced a problem with the seatbelts, the clutch sticking and over-revving and windscreen wipers not shedding water. We contacted the dealership who initially said the clutch could not be faulted, only to later say there was a problem, but it gets resolved if you remove the floor mats. Bizarre, I know!, but this is what they told me. The wipers were replaced. But they faulted not only the front seatbelts where we had observed them not functioning, but also the rear seatbelts. we had in fact been sold a car with no functioning seatbelts.

The garage had the car in for repair from 06/12/24 until 14/01/25 whilst they awaited parts. We were provided a courtesy car for most of this time, however we were not permitted to use this for business purposes, minimizing the help and relief it could provide us.

We immediately observed the clutch had no resistance, indicating some form of work had been carried out on it, despite the dealership suggesting otherwise. Similar problems with sticking, slipping out of gear were still observed. after a few days, an exhaust failure and engine management warning came on. The car was shortly back in for repair. 

We were then advised the clutch had been retested, and they had now faulted it. But given the quality of the car, the new problems experienced, and the general service provided (which i've not documented fully )here, I advised them I wanted to pursue a rejection as they had a been given an opportunity to repair a major fault, and failed to do so - as well as the goods being illegal due to the non-functioning seatbelts in the first place.

A long-ish story short, but the rejection has been accepted by both the dealership and the finance company. However, when i went to hand in the spare key to the car, they demanded a £1000 payment owing to the original negative equity on the deal. 

We were astonished, but understanding to a certain extent. Our original PX car was later resold by the dealer (for £15,000) therefore couldn't be returned to me. My problem is that the PX value we agreed to, in my mind, was part of the 'package deal' for the new vehicle. In isolation, we would never have agreed to this value.

The rejection is not because we had simply changed our mind, it was because the goods were genuinely not fit for purpose, and accepted by the dealer. It does not appear reasonable that I should suffer further and be liable for the original negative equity as, at the end of the day, this matter only existed through the actions of the dealer and the quality of the goods.

I've not therefore had the opportunity to achieve full market value of the older car. Ironically the dealer did, achieving £3000 above the PX value. 

Anyone's thoughts would be appreciated....

DullGreyGuy

Did you put any deposit down on the car you bought?
Are they suggesting any deduction for use?

Sound like you are saying you bought a car for £15,000 and took a loan for £16,000 from them because the trade in was negative equity. 

born_again

gc7 said:

Advice sought for a matter I'm going through right now. key points noted below:

I purchased a car from Arnold Clark on 19/11/24. This involved trading an older car, with a PX value of at £12,000 and finance settlement of £13,000. A negative equity of £1,000. The new car was also purchased on finance.

Immediately on leaving the forecourt, some minor issues were noted such as tyre pressure warnings coming on and parcel shelf ill-fitting. After a few days we experienced a problem with the seatbelts, the clutch sticking and over-revving and windscreen wipers not shedding water. We contacted the dealership who initially said the clutch could not be faulted, only to later say there was a problem, but it gets resolved if you remove the floor mats. Bizarre, I know!, but this is what they told me. The wipers were replaced. But they faulted not only the front seatbelts where we had observed them not functioning, but also the rear seatbelts. we had in fact been sold a car with no functioning seatbelts.

The garage had the car in for repair from 06/12/24 until 14/01/25 whilst they awaited parts. We were provided a courtesy car for most of this time, however we were not permitted to use this for business purposes, minimizing the help and relief it could provide us.

We immediately observed the clutch had no resistance, indicating some form of work had been carried out on it, despite the dealership suggesting otherwise. Similar problems with sticking, slipping out of gear were still observed. after a few days, an exhaust failure and engine management warning came on. The car was shortly back in for repair. 

We were then advised the clutch had been retested, and they had now faulted it. But given the quality of the car, the new problems experienced, and the general service provided (which i've not documented fully )here, I advised them I wanted to pursue a rejection as they had a been given an opportunity to repair a major fault, and failed to do so - as well as the goods being illegal due to the non-functioning seatbelts in the first place.

A long-ish story short, but the rejection has been accepted by both the dealership and the finance company. However, when i went to hand in the spare key to the car, they demanded a £1000 payment owing to the original negative equity on the deal. 

We were astonished, but understanding to a certain extent. Our original PX car was later resold by the dealer (for £15,000) therefore couldn't be returned to me. My problem is that the PX value we agreed to, in my mind, was part of the 'package deal' for the new vehicle. In isolation, we would never have agreed to this value.

The rejection is not because we had simply changed our mind, it was because the goods were genuinely not fit for purpose, and accepted by the dealer. It does not appear reasonable that I should suffer further and be liable for the original negative equity as, at the end of the day, this matter only existed through the actions of the dealer and the quality of the goods.

I've not therefore had the opportunity to achieve full market value of the older car. Ironically the dealer did, achieving £3000 above the PX value. 

Anyone's thoughts would be appreciated....

Guessing the finance was for car £15.000 + £1000 for the negative equity.

Thus, you do owe them £1000, or more to the point the finance co. As rejecting the car would only refund you the value of the car £15000.

What they sold the car for has nothing to do with the amount you owe, for the loan taken out,

Had you not rejected the car, then you would have paid the £1000 NE back. So the issue of the £1000 has existed all the time. 
Rejecting the car, has changed nothing as far as NE goes.

Alderbank

gc7 said:

Anyone's thoughts would be appreciated....

I have a couple of thoughts...

You say 'We were provided a courtesy car for most of this time, however we were not permitted to use this for business purposes, minimizing the help and relief it could provide us.'

I think that is reasonable. Your right to cancel the contract of sale is a consumer right. It would not have been available to you if the purchase had been mainly or wholly in connection with your business.

Also, I can't see why you did not have the opportunity to achieve full market value of your car?

At any time until AC took it in as P/A, surely you could have offered it for private sale? You would have had to settle the  outstanding finance first of course and the market value of a used car sold at private sale is much less than the same car fully valeted and serviced sold by a major dealership with the full benefits of consumer rights.

gc7

DullGreyGuy said:

Did you put any deposit down on the car you bought?
Are they suggesting any deduction for use?

Sound like you are saying you bought a car for £15,000 and took a loan for £16,000 from them because the trade in was negative equity. 

Thank you for comments. 

Yes, I put down down a £300 deposit. AC have deducted this from the £1000 negative equity and looking for me to pay another £700. No suggestion yet of deduction for use (although this would be minimal)

Yes, in effect the new finance was for £16,000 and vehicle price was £15,000 - in effect rolling the negative equity into the new finance arrangement.

gc7

born_again said:

gc7 said:

Advice sought for a matter I'm going through right now. key points noted below:

I purchased a car from Arnold Clark on 19/11/24. This involved trading an older car, with a PX value of at £12,000 and finance settlement of £13,000. A negative equity of £1,000. The new car was also purchased on finance.

Immediately on leaving the forecourt, some minor issues were noted such as tyre pressure warnings coming on and parcel shelf ill-fitting. After a few days we experienced a problem with the seatbelts, the clutch sticking and over-revving and windscreen wipers not shedding water. We contacted the dealership who initially said the clutch could not be faulted, only to later say there was a problem, but it gets resolved if you remove the floor mats. Bizarre, I know!, but this is what they told me. The wipers were replaced. But they faulted not only the front seatbelts where we had observed them not functioning, but also the rear seatbelts. we had in fact been sold a car with no functioning seatbelts.

The garage had the car in for repair from 06/12/24 until 14/01/25 whilst they awaited parts. We were provided a courtesy car for most of this time, however we were not permitted to use this for business purposes, minimizing the help and relief it could provide us.

We immediately observed the clutch had no resistance, indicating some form of work had been carried out on it, despite the dealership suggesting otherwise. Similar problems with sticking, slipping out of gear were still observed. after a few days, an exhaust failure and engine management warning came on. The car was shortly back in for repair. 

We were then advised the clutch had been retested, and they had now faulted it. But given the quality of the car, the new problems experienced, and the general service provided (which i've not documented fully )here, I advised them I wanted to pursue a rejection as they had a been given an opportunity to repair a major fault, and failed to do so - as well as the goods being illegal due to the non-functioning seatbelts in the first place.

A long-ish story short, but the rejection has been accepted by both the dealership and the finance company. However, when i went to hand in the spare key to the car, they demanded a £1000 payment owing to the original negative equity on the deal. 

We were astonished, but understanding to a certain extent. Our original PX car was later resold by the dealer (for £15,000) therefore couldn't be returned to me. My problem is that the PX value we agreed to, in my mind, was part of the 'package deal' for the new vehicle. In isolation, we would never have agreed to this value.

The rejection is not because we had simply changed our mind, it was because the goods were genuinely not fit for purpose, and accepted by the dealer. It does not appear reasonable that I should suffer further and be liable for the original negative equity as, at the end of the day, this matter only existed through the actions of the dealer and the quality of the goods.

I've not therefore had the opportunity to achieve full market value of the older car. Ironically the dealer did, achieving £3000 above the PX value. 

Anyone's thoughts would be appreciated....

Guessing the finance was for car £15.000 + £1000 for the negative equity.

Thus, you do owe them £1000, or more to the point the finance co. As rejecting the car would only refund you the value of the car £15000.

What they sold the car for has nothing to do with the amount you owe, for the loan taken out,

Had you not rejected the car, then you would have paid the £1000 NE back. So the issue of the £1000 has existed all the time. 
Rejecting the car, has changed nothing as far as NE goes.

Thank you for input. Yes, new finance was £16000 as you say (£15k car plus £1k NE)

I understand the NE always, and still exists. Reasonable in circumstances of it being a package deal, and accepting the lower than market value PX price as part of a bigger deal. In isolation, and with hindsight of what was to come, I can't get away from it being reasonable to now say that was fair value in the circumstances. The NE is a result of the PX value, not the market price of the car. i.e. if I knew then what was to come, we would have sold the car privately. I've been denied that opportunity now because of the rejection. But the rejection is not of my doing - the car was genuinely faulty. 

gc7

Alderbank said:

gc7 said:

Anyone's thoughts would be appreciated....

I have a couple of thoughts...

You say 'We were provided a courtesy car for most of this time, however we were not permitted to use this for business purposes, minimizing the help and relief it could provide us.'

I think that is reasonable. Your right to cancel the contract of sale is a consumer right. It would not have been available to you if the purchase had been mainly or wholly in connection with your business.

Also, I can't see why you did not have the opportunity to achieve full market value of your car?

At any time until AC took it in as P/A, surely you could have offered it for private sale? You would have had to settle the  outstanding finance first of course and the market value of a used car sold at private sale is much less than the same car fully valeted and serviced sold by a major dealership with the full benefits of consumer rights.

Thank you for your thoughts.

The part of not having opportunity to achieve full market value of the car. Point taken I could have offered it for private sale beforehand. In hindsight, this a valid point. However, in the moment of trying to negotiate a deal, we were willing to accept the offered PX value as part of the overall package. At no point then did we remotely anticipate getting into the problems we did, leaving no choice but to reject. Because the dealership has now sold the car, I am unable to have it returned to sell myself. It doesn't seem to me to be reasonable to be held to the original PX value (which in effect is creating the NE).

visidigi

gc7 said:

born_again said:

gc7 said:

Advice sought for a matter I'm going through right now. key points noted below:

I purchased a car from Arnold Clark on 19/11/24. This involved trading an older car, with a PX value of at £12,000 and finance settlement of £13,000. A negative equity of £1,000. The new car was also purchased on finance.

Immediately on leaving the forecourt, some minor issues were noted such as tyre pressure warnings coming on and parcel shelf ill-fitting. After a few days we experienced a problem with the seatbelts, the clutch sticking and over-revving and windscreen wipers not shedding water. We contacted the dealership who initially said the clutch could not be faulted, only to later say there was a problem, but it gets resolved if you remove the floor mats. Bizarre, I know!, but this is what they told me. The wipers were replaced. But they faulted not only the front seatbelts where we had observed them not functioning, but also the rear seatbelts. we had in fact been sold a car with no functioning seatbelts.

The garage had the car in for repair from 06/12/24 until 14/01/25 whilst they awaited parts. We were provided a courtesy car for most of this time, however we were not permitted to use this for business purposes, minimizing the help and relief it could provide us.

We immediately observed the clutch had no resistance, indicating some form of work had been carried out on it, despite the dealership suggesting otherwise. Similar problems with sticking, slipping out of gear were still observed. after a few days, an exhaust failure and engine management warning came on. The car was shortly back in for repair. 

We were then advised the clutch had been retested, and they had now faulted it. But given the quality of the car, the new problems experienced, and the general service provided (which i've not documented fully )here, I advised them I wanted to pursue a rejection as they had a been given an opportunity to repair a major fault, and failed to do so - as well as the goods being illegal due to the non-functioning seatbelts in the first place.

A long-ish story short, but the rejection has been accepted by both the dealership and the finance company. However, when i went to hand in the spare key to the car, they demanded a £1000 payment owing to the original negative equity on the deal. 

We were astonished, but understanding to a certain extent. Our original PX car was later resold by the dealer (for £15,000) therefore couldn't be returned to me. My problem is that the PX value we agreed to, in my mind, was part of the 'package deal' for the new vehicle. In isolation, we would never have agreed to this value.

The rejection is not because we had simply changed our mind, it was because the goods were genuinely not fit for purpose, and accepted by the dealer. It does not appear reasonable that I should suffer further and be liable for the original negative equity as, at the end of the day, this matter only existed through the actions of the dealer and the quality of the goods.

I've not therefore had the opportunity to achieve full market value of the older car. Ironically the dealer did, achieving £3000 above the PX value. 

Anyone's thoughts would be appreciated....

Guessing the finance was for car £15.000 + £1000 for the negative equity.

Thus, you do owe them £1000, or more to the point the finance co. As rejecting the car would only refund you the value of the car £15000.

What they sold the car for has nothing to do with the amount you owe, for the loan taken out,

Had you not rejected the car, then you would have paid the £1000 NE back. So the issue of the £1000 has existed all the time. 
Rejecting the car, has changed nothing as far as NE goes.

Thank you for input. Yes, new finance was £16000 as you say (£15k car plus £1k NE)

I understand the NE always, and still exists. Reasonable in circumstances of it being a package deal, and accepting the lower than market value PX price as part of a bigger deal. In isolation, and with hindsight of what was to come, I can't get away from it being reasonable to now say that was fair value in the circumstances. The NE is a result of the PX value, not the market price of the car. i.e. if I knew then what was to come, we would have sold the car privately. I've been denied that opportunity now because of the rejection. But the rejection is not of my doing - the car was genuinely faulty. 

The moment you accepted the deal was the moment you accepted the value offered was acceptable. Just because the deal didn't work out doesn't change the value you accepted.

Its not unusual for package pricing to be done in these sorts of scenarios - there was nothing stopping you selling the car privately, you of course could have done that at any point.

gc7

visidigi said:

gc7 said:

born_again said:

gc7 said:

Advice sought for a matter I'm going through right now. key points noted below:

I purchased a car from Arnold Clark on 19/11/24. This involved trading an older car, with a PX value of at £12,000 and finance settlement of £13,000. A negative equity of £1,000. The new car was also purchased on finance.

Immediately on leaving the forecourt, some minor issues were noted such as tyre pressure warnings coming on and parcel shelf ill-fitting. After a few days we experienced a problem with the seatbelts, the clutch sticking and over-revving and windscreen wipers not shedding water. We contacted the dealership who initially said the clutch could not be faulted, only to later say there was a problem, but it gets resolved if you remove the floor mats. Bizarre, I know!, but this is what they told me. The wipers were replaced. But they faulted not only the front seatbelts where we had observed them not functioning, but also the rear seatbelts. we had in fact been sold a car with no functioning seatbelts.

The garage had the car in for repair from 06/12/24 until 14/01/25 whilst they awaited parts. We were provided a courtesy car for most of this time, however we were not permitted to use this for business purposes, minimizing the help and relief it could provide us.

We immediately observed the clutch had no resistance, indicating some form of work had been carried out on it, despite the dealership suggesting otherwise. Similar problems with sticking, slipping out of gear were still observed. after a few days, an exhaust failure and engine management warning came on. The car was shortly back in for repair. 

We were then advised the clutch had been retested, and they had now faulted it. But given the quality of the car, the new problems experienced, and the general service provided (which i've not documented fully )here, I advised them I wanted to pursue a rejection as they had a been given an opportunity to repair a major fault, and failed to do so - as well as the goods being illegal due to the non-functioning seatbelts in the first place.

A long-ish story short, but the rejection has been accepted by both the dealership and the finance company. However, when i went to hand in the spare key to the car, they demanded a £1000 payment owing to the original negative equity on the deal. 

We were astonished, but understanding to a certain extent. Our original PX car was later resold by the dealer (for £15,000) therefore couldn't be returned to me. My problem is that the PX value we agreed to, in my mind, was part of the 'package deal' for the new vehicle. In isolation, we would never have agreed to this value.

The rejection is not because we had simply changed our mind, it was because the goods were genuinely not fit for purpose, and accepted by the dealer. It does not appear reasonable that I should suffer further and be liable for the original negative equity as, at the end of the day, this matter only existed through the actions of the dealer and the quality of the goods.

I've not therefore had the opportunity to achieve full market value of the older car. Ironically the dealer did, achieving £3000 above the PX value. 

Anyone's thoughts would be appreciated....

Guessing the finance was for car £15.000 + £1000 for the negative equity.

Thus, you do owe them £1000, or more to the point the finance co. As rejecting the car would only refund you the value of the car £15000.

What they sold the car for has nothing to do with the amount you owe, for the loan taken out,

Had you not rejected the car, then you would have paid the £1000 NE back. So the issue of the £1000 has existed all the time. 
Rejecting the car, has changed nothing as far as NE goes.

Thank you for input. Yes, new finance was £16000 as you say (£15k car plus £1k NE)

I understand the NE always, and still exists. Reasonable in circumstances of it being a package deal, and accepting the lower than market value PX price as part of a bigger deal. In isolation, and with hindsight of what was to come, I can't get away from it being reasonable to now say that was fair value in the circumstances. The NE is a result of the PX value, not the market price of the car. i.e. if I knew then what was to come, we would have sold the car privately. I've been denied that opportunity now because of the rejection. But the rejection is not of my doing - the car was genuinely faulty. 

The moment you accepted the deal was the moment you accepted the value offered was acceptable. Just because the deal didn't work out doesn't change the value you accepted.

Its not unusual for package pricing to be done in these sorts of scenarios - there was nothing stopping you selling the car privately, you of course could have done that at any point.

I disagree that the moment I accepted the deal was the moment I accepted the value offered. My acceptance of the deal was based on the value and condition of goods I was purchasing. Through no fault of my own, this wasn't the case. In fact it turned out there wasn't just a serious hidden defect before purchase, it was illegal owning to no functioning seatbelts. Had this been known, there would be no deal, or at least a deal under under these same terms. 

I agree nothing stopping me selling privately before everything, however far too easy to say with hindsight. Too many other factors to account for such as finding finance to settle early before selling, the time and inconvenience. I want to be, and believe I should be, in the same financial position i was in had the sale not happened at all. I don't believe I am - I don't have the asset I can sell, nor the equivalent value. 

Alderbank

You are correct that it is illegal under the Road Traffic Act for a trader to sell a car to a consumer which at the point of sale is unroadworthy. He must either fix it or pass it on to another dealer by way of trade.

However to be fair to us, you said:
Immediately on leaving the forecourt, some minor issues were noted... After a few days we experienced a problem with the seatbelts...

Not all seatbelt problems or annoyances are automatic MOT fail

eskbanker

gc7 said:
I want to be, and believe I should be, in the same financial position i was in had the sale not happened at all. I don't believe I am - I don't have the asset I can sell, nor the equivalent value. 

Surely beforehand you had liabilities of £13K exceeding £12K of assets by £1K, so you are now in the same net financial position, i.e. owing £1K?