Car PCP: Early Settlement

[skagerRak]

Hello R0b,

Does paying the full early settlement figure on a PCP clear all the outstanding finance including excess mileage? Or will a finance company still seek charges for miles in excess of the original agreement?

Any advice on this greatly appreciated.

Cheers,

skageRrak

[R0b]

Re: Car PCP: Early Settlement

Hello

By paying the early settlement it would clear any excess mileage as the car would be owned by you, not the lender. It would seem absurd for them to charge you excess mileage on your own car, though I wouldn't put it past them trying! The contractual arrangement is the total price of the agreement less any discount for early settlement. Excess mileage charges tend to be imposed where the car is returned to the lender.

[skagerRak]

Re: Car PCP: Early Settlement

Thanks. Very helpful. There seems to be an amazing amount of conflicting and confusing 'advice' on this particular issue from car sales personnel not to mention the generally unhelpful and misleading 'guidance' from finance companies.

[skagerRak]

Re: Car PCP: VT form and Section 100 of the Customer Credit Act 1974

Thanks. Very helpful. There seems to be an amazing amount of conflicting and confusing 'advice' on this particular issue from car sales personnel not to mention the generally unhelpful and misleading 'guidance' from finance companies.

Hi,

A VT letter and form received from my car finance company - following several requests - looks informative and reasonable enough save for mention of my liability 'for the amount calculated under the formula in Section 100 of the Consumer Credit Act 1974'. Is this excess mileage chasing by another name and will signing this form, as requested, give the finance company more leverage in reclaiming any excess mileage? Do you think excess mileage should be negotiated or ignored and not paid given that all else with the vehicle and all payments are in good order, well over 50% of the value having been paid?

[R0b]

Re: Car PCP: Early Settlement

Do not confuse early settlement with voluntary termination that you see on here. Early settlement is a way to pay off the total balance with a deduction of interest remaining on the contract and the car then belongs to you. Voluntary termination limits your liability to 50% and the car is returned to the lender.

[Amethyst]

Re: Car PCP: VT form and Section 100 of the Customer Credit Act 1974

Are you VT'ing and returning the car or making early settlement to keep the car ?

( or what R0b says - sorry R0b crossed posts )

[skagerRak]

Re: Car PCP: Early Settlement

Hi R0b,

I understand the difference re Early Settlement and VT. I have not yet decided which route to take. I'm cautious about signing any forms that give the finance company more clout for claiming excess mileage. Any advice on this?

[R0b]

Re: Car PCP: Early Settlement

Personally I wouldn't sign any of their paperwork regarding VT. No legal obligation to do so and it doesn't affect termination of the agreement. You could in theory sign the paperwork but that's your prerogative and they will no doubt use that against you and at which point you are immediately on the back foot if it went to court. Fortunately, section 173 of the CCA says you cannot contract out of the provisions of the CCA where it affords the hirer protection so any paperwork that imposes additional liability directly or indirectly will be deemed void and unenforceable but you still put yourself on the backfoot for no reason. See the link below for more information

http://www.legislation.gov.uk/ukpga/...173/2000-10-31