Wanting to cancel purchase of new car. PCP contra-settled.

[Lee234]

Hi all,

First post here, so please bear with, and thanks in advance for all input, I've read loads of posts and everybody is really helpful.

Old PCP from VW Finance was settled Monday due to new finance agreement being signed last Saturday.

Originally my SO was planning on buying a 5 door Polo to replace her 3 door which we currently have, however after signing finance agreement has realised that the free insurance does not provide everything needed (cover for me, excess is too high etc); and so wants to back out of the deal.

The car has not yet been received as we didn't go to pick it up, and we still have the 14 plate.

Finance co and dealership are telling us that the dealership now own the 14 plate and we are the proud owners of a brand new 65 plate. There is a right of withdrawal clause in the pre contract information (which is all the docs we have) however we are being told that this no longer stands as there has been a contra settlement against the old PCP contract.

It seems that the finance co and dealership are in each others pockets (obviously) and they are confusing the finance agreement and bill of sale?

The outcome we are hoping to obtain is to keep the 14 plate and cancel the purchase of the 65 plate.

Any ideas much appreciated!

[R0b]

Re: Wanting to cancel purchase of new car. PCP contra-settled.

If you signed the agreement on the premises of the dealership then I think you are out of luck. If you decided to take the agreement home and then sign it and return to the dealer then there is something called a cancellable agreement which gives you 5 days from receiving the executed agreement/notice of cancellation rights to cancel the agreement without any penalty.

Be careful about the right to withdraw, this means that you can withdraw from the credit agreement but does not get you out of the contract for the car as the two are mutually exclusive. You would therefore need to pay for the vehicle in some other way nd unless you have the funds for it I would advise against doing this. Once you have committed to withdrawing from the agreement it cannot be reversed.

[Lee234]

Re: Wanting to cancel purchase of new car. PCP contra-settled.

The business manager at the dealership has said he would be happy to drop the sale and let us keep the 14 plate, however old finance cannot be reinstated.

The agreement was signed on their premises, as yet although I have spoken to finance co, there has been no agreement to cancel the new finance owing to the fact that it cant be due to the contra settlement; problem is, we don't have the new finance agreement, only a welcome pack which arrived this morning, both copies of the finance have been left there.

I was hoping that as the business manager has said the sale can be cancelled, and that he wouldnt want to make a 'profit' as such selling the 14 plate back to us that there might be somewhere to go with this?

What are your thoughts?

Cheers,

[R0b]

Re: Wanting to cancel purchase of new car. PCP contra-settled.

Well, I'm not sure by what they mean "contra settlement". Presumably they mean that the outstanding finance is lumped onto the new finance? I've not really dealt with these before but I would like to see the agreement if you can get a copy. The problem I see is that you have a right to withdraw, its set in law and it cannot be revoked. So if you decide to withdraw, then the whole of the finance is withdrawn (including the previous financial amount).

Can you get in writing from the salesman that he is accepting that the sale can be cancelled? The worst case scenario I see is that you might have to pay back the outstanding balance of the old agreement.. unless the new agreement says the old one has been superceded.

Would need to see the agreement though to fully understand the position. Creditors cannot simply prevent you from withdrawing from the financail agreement. Once you withdraw, then you are held to the contractual side of the vehicle as I said before, but if the salesman agrees to cancel then effectively you would have nothing to pay?!

How many days has it been since the agreement is signed?

[Lee234]

Re: Wanting to cancel purchase of new car. PCP contra-settled.

I think you're exactly right with it being lumped on, or taking away from dealer profits..

I have it voice recorded that the business manager is happy to put 'everyone where they were before' or 'unwind the whole deal' if finance co are able, suppose I could ask for it in writing- considering asking for a copy of the finance agreement tomorrow/Monday.

Finance was signed last Saturday and dealership and finance informed weds that we no longer wanted the deal.

Will let you know if we get the agreement as soon as poss..

[Lee234]

Re: Wanting to cancel purchase of new car. PCP contra-settled.

** Update **

We have managed to cancel the sale and exercise right of withdrawal, however because the old finance has been settled the dealership are saying we need to meet with them because we owe them the settlement for the finance meaning we owe them £7300.

Surely this should be reversable between the finance co/ dealership?

My train of thought is that they jumped the gun so they need to unjump it? We have received confirmation that old finance is settled and we own the car if that helps?

Any ideas really appreciated.

Cheers,

[R0b]

Re: Wanting to cancel purchase of new car. PCP contra-settled.

Hi Lee,

Good to hear that is has been cancelled. why are the dealership saying that they are owed the settlement of £7300. If the finance co has paid the dealer and then the money you signed to borrow which included the old finance why are they still asking for money if they have agreed to withdraw the sale?

[Lee234]

Re: Wanting to cancel purchase of new car. PCP contra-settled.

Seems like the dealer have paid the finance for the old car off, don't have a clue where to go from here, surely finance should just refund the dealer??

[R0b]

Re: Wanting to cancel purchase of new car. PCP contra-settled.

Get the dealer to confirm in writing exactly why they believe they are owed £7,300. They have agreed and confirmed that they sale of the new vehicle is withdrawn and the finance company have confirmed that the agreement for finance has been withdrawn with nothing owed.

[Lee234]

Re: Wanting to cancel purchase of new car. PCP contra-settled.

It's feeling like very sketchy ground, any clues on what the outcome is likely to be so we can in go prepared?

[R0b]

Re: Wanting to cancel purchase of new car. PCP contra-settled.

Difficult to answer without knowing their reasons why the believe it they are owed that amount. For the time being stick to your argument that you feel nothing is owed because they have agreed to withdraw the new sale, and the finance co confirmed that no money is owed. Take someone along with you as a witness to this so if it ever escalates you have someone to back you up.

[Lee234]

Re: Wanting to cancel purchase of new car. PCP contra-settled.

Difficult to answer without knowing their reasons why the believe it they are owed that amount. For the time being stick to your argument that you feel nothing is owed because they have agreed to withdraw the new sale, and the finance co confirmed that no money is owed. Take someone along with you as a witness to this so if it ever escalates you have someone to back you up.

This is the response from the dealership received this evening, ignoring the fact it was sent to an incorrect email address originally so had to chase them again, and that the reg details started getting quite confused, this is word for word...

Good Morning Lee,

As per our telephone conversation, clarity of our current situation.

Bonnie signed her new finance agreement on 13/02/2016. On completion, this triggered the following:

Bonnie’s new agreement on AA65 BBB is now live, she will have had correspondence from Volkswagen Financial Services of her first direct debit (normally 4 weeks from signature)

Full settlement to Volkswagen Financial Services for BB14 LLL - £7349.07. This was taken from our bank account on the 15^th February 2016.

BB14 LLL is now not subject to any outstanding finance, but is on a 4 month stocking plan initiated by ourselves on payment of the settlement figure. This means that BB14 LLL is effectively our car.

As I’m sure you are aware, we have 30 days to cancel the current live finance agreement on and cancel any registration of the new car.

The problem we have is BB14 LLL. Volkswagen Financial Services cannot, in any circumstance reinstate the finance agreement on Bonnie’s old car – BB14 LLL.

In good faith, we have settled BB14 LLL with Volkswagen Financial Services so now unfortunately Bonnie owes us £7,349.07.

We will endeavour to help you both in any solution you feel comfortable, however the time element in finding that solution makes the gravity of the situation greater each day.

I look forward to your prompt response,

Regards,

Steve

What do you think?