Voluntary Termination with excess mileage

[claretkoe]

Hi,

my wife is 28 months into a 36 month PCP agreement with Ford.

The car is becoming unaffordable for her and has contacted the finance company to discuss VT.

they have said she can as she has paid in excess of 50% but are stating excess mileage charges will apply. because she was sold this car with 6000 miles allowed which was never suitable, she has gone over that and would owe around £550 in mileage. which we would struggle to pay

if VT'ing the car is this amount still payable? ford are telling her it is.

there are mixed views over the internet.

thanks for reading

[R0b]

Re: Voluntary Termination with excess mileage

Hello, the short answer (my opinion) is no they cannot. The excess mileage is a contractual term and is only payable on breach. If your wife didn't VT and completed the contract then she would be liable for those costs. However, the VT process affords protection to those who terminate and limits liability to 50% of the total amount payable under the credit agreement and any arrears due before the agreement was terminated. The liability does not extend to paying the lender damages for breach of the contract.

There are mixed reviews out there and you will see that the majority of people who have been with Ford end up coughing up. This is not because Ford are legally entitled to it, its because they just want it over with.

Ford will claim they are entitled to it because it is written into the contract, however such a clause contradicts what the Consumer Credit Act says and is therefore void and unenforceable. It won't prevent Ford or any other lender from claiming that they are entitled to it though.

One other point to note is that if the 6,000 miles per annum was not suitable for your wife's use, then there could also be a case of misrepresentation.

[Kinglewi6]

Re: Voluntary Termination with excess mileage

Is there any link you can provide to the legislation that can be quoted to back that argument? I'm in the same position, regarding a VT with some excess mileage, and I'm not in a position where I want to pay excess mileage, especially if I'm not legally obliged to.

[R0b]

Re: Voluntary Termination with excess mileage

Section 100 http://www.legislation.gov.uk/ukpga/1974/39/section/100

Section 189 defines "total price" and does not include damages for breach of the agreement http://www.legislation.gov.uk/ukpga/1974/39/section/189

Section 173 states that any contractual term which is inconsistent with a debtors rights/liability is void and unenforceable http://www.legislation.gov.uk/ukpga/1974/39/section/173

You have to read it all together to understand it.

A further nail in the coffin is The Consumer Credit (Agreements) Regulations 2010 below

Schedule 1 sets out what must be included in a regulated agreement which refers to the 'debtors maximum liability under s.100' (see para. 30 in the table) http://www.legislation.gov.uk/uksi/2...chedule/1/made

Schedule 2 sets out the statements that must be included in a regulated agreement depending on the type of agreement. In this case, statements for hire purchase or conditional sale agreements is set out under para. 9 in the table. As you ca see it says that provided you have paid at least X and taken care of the goods then you will not have to pay anymore http://www.legislation.gov.uk/uksi/2...chedule/2/made