Voluntary Termination

[gixergirl777]

Re: Voluntary Termination

Thanks Labman, appreciate your help. I think it's the bit that says "Bill of Sale" that is my problem.
I've been reading up articles all evening but this doesn't look like good news. It seems that Bills of Sale don't hold any of the protection that HP does. Thing is, when I signed up for the agreement no-one explained that I was taking out a Bill of Sale and that it wasn't a normal finance agreement. I'm not surpised they make it look as near to proper HP as possible as then people like me end up signing it
From what I can see, they don't have to accept VT, the moment I default on a single repayment they are entitled to repossess the car and I am still liable for the outstanding finance. Really hoping someone here might tell me that i've got it all wrong though.....

Found this on the ACF Car Finance site... http://www.acfcarfinance.co.uk/_asse...BillOfSale.pdf

[labman]

Re: Voluntary Termination

Ouch! I so hope that is wrong. At the end of the day though, if you can't afford it, you can't and they cannot get blood out of a stone. They can get a CCJ, but if your Income and Expenditure Form proves you can't pay what they want, any court will only order you to pay an affordable amount each month.

Still hope it works out well though - I'll watch with interest.

[Guest]

Re: Voluntary Termination

HI
Yes i remember we did a far bit of work on thee some years ago.

The way they work is, the creditor obtains a loan for the vehicle on the debtors behalf and he purchases it, he then passes title of the car back to the dealer via a bill of sale which acts as security for the loan.
As militant says the two run side by side.

So what we have is a fixed term loan secured by a bill of sale, this is not a bill of sale loan in the normal sense.

I have been doing some digging around and there has been some success in challenging these, on unenforceable issues, and fairness as they do bypass the protection of the CCA.

Is it possible to see the loan agreement.

Peter

[Guest]

Re: Voluntary Termination

HI

Sorry missed the earlier post of the agreement, it is a fixed sum agreement, as expected and unfortunately not eligible for VT.

I will check the figures.

I know that some of these have been challenged under section 140 of the cca 2006 as being unfair in that they circumvent the protection of the act.

Most have been settled out of court to my knowledge.

Peter

[Guest]

Re: Voluntary Termination

HI
OK just been gooing through some of my files, i hope you are still with this This is from the OFT guideline(see attached

First you need to check the validity of the bill of sale.

Royal Courts of Justice
The Bill of Sale must be witnessed and registered at the Royal Courts of Justice, in the time and
manner set out in the BSA, otherwise it will be void and cannot be treated as a licence to take possession. You can check if this has been carried out by making a written request to the Court and paying £5 or visiting there in person and searching the register for free. To search you need to
know the name of the borrower, their address and the year of registration.The entries in the register are made alphabetically in the name of the borrower.
The address is:
Room E17, East Block Ground Floor, Royal Courts of Justice, Strand, London WC2A 2LL**

Also note this.

k. In practice, the majority of such bills of sale may well be unenforceable because the provisions of the Bills of Sale Acts are unlikely to have been followed, and even if they have, the relevant requirements of the Consumer Credit Act 1974 must also be satisfied.

l. The bill of sale and related credit agreement may also be susceptible to action under the Unfair Terms in Consumer Contracts Regulations 1999 or under the extortionate credit bargain provisions of the Consumer Credit Act 1974.

m.Whether title can pass to a third party where there is a valid bill of sale will depend upon whether the bill transfers legal or equitable title to the grantee, and each case would need to be looked at on its facts.

[gixergirl777]

Re: Voluntary Termination

Thank you Peter and Labman for your insight here.
It all feels rather unfortunate, I will write off to the Courts to check whether the Bill of Sale has been registed correctly.
Even if the Bill of Sale has failed to meet the correct registration criteria and is not enforcable, being that this is a fixed sum loan agreement, what options do I have?
I am actually happy for them to take the car, however it seems I may as well try to keep hold of it if I am held liable for the full sum anyway.

I am in the process of selling my house, the buyer has no chain, we are just resolving an issue over a right of way (i'm hoping this will happen in a matter of weeks, but there is a always a chance it won't!), if I can just last out till the sale goes through, worst case scenario I can just pay off the Funding Corporation/ACF Car Finance and never hear from them again.... but so disappointed to find myself in this situation.

Really appreciate you help on this!

Terri

[Guest]

Re: Voluntary Termination

HI
If the bill of sale is not binding it means that all they have is an unsecured loan.

You can make an offer to repay what you can afford backed up by an i and e statement or go through a DMP.

Or since the car would then be your property you could sell it yourself and pay it off.

And of course there is this;

106 Ineffective securities
Where, under any provision of this Act, this section is applied to any security provided in relation to a regulated agreement, then, subject to section 177 (saving for registered charges),—


(a) the security, so far as it is so provided, shall be treated as never having
effect;
(b) any property lodged with the creditor or owner solely for the purposes of
the security as so provided shall be returned by him forthwith;
(c) the creditor or owner shall take any necessary action to remove or cancel
an entry in any register, so far as the entry relates to the security as so
provided; and
(d) any amount received by the creditor or owner on realisation of the
security shall, so far as it is referable to the agreement, be repaid to the
surety.

Which basically means that all monies paid to the creditor should be repaid.

If it were me and i found that the bill of sale was in fact void i would mention this section in my letter to the creditor, i do not think it is something you should pursue as a LIP(although some have) but it may make them stop and think.

Peter

Peter

[gixergirl777]

Re: Voluntary Termination

Thank you Peter - there is some hope it would seem!
I'll let you know what happens with the Bill of Sale.

Terri

[labman]

Re: Voluntary Termination

HI
If the bill of sale is not binding it means that all they have is an unsecured loan.

You can make an offer to repay what you can afford backed up by an a and e statement or go through a DMP.

OMG - the garage aren't that violent are they! Hopefully you mean I and E statement

Seriously, that is a fantastic post Peter, and using that part of the CCA could very well stop and make them think.

[Guest]

Re: Voluntary Termination

HI

I knew there was something I had seen on this. Some more pressure to put on the creditor


http://www.bllaw.co.uk/sectors/finan...s_of_sale.aspx
new Code of Practice relating to bills of sale

The Government announced on 28 January 2011 that the 'bills of sale' money lending industry will be working under a new Code of Practice from 1 February 2011. Lenders will have to provide customers with a plain English information sheet explaining how bills of sale work and what customers may expect from the lender.
background

A bill of sale is used to secure a loan on a customer's personal property, typically a car. Bills of sale are somewhat archaic and there have been concerns in the past about how difficult they are to understand. Concerns have also been expressed regarding loan sharks who tend to focus on this type of loan. However, the Government rejected the option of imposing a ban on bills of sale, considering that it would restrict consumer access to credit, reduce choice and push up prices. It was also felt that it would be disproportionate to ban an industry just because of a few rogue lenders. In time, a legislative solution may be necessary but the Government felt the industry should try to regulate itself first, by way of the new Code.
the new Code of Practice

Borrowers who are in arrears will be able to return the item purchased, such as a car, in full settlement of their debt. They will not be liable for any shortfall between the outstanding debt and the value of the vehicle.
The option of making balloon payments (that is small initial repayments covering only the interest, with the capital being repaid in a single final payment) will only now be available to business customers who can provide evidence that they will have funds to make the final repayment.
The bill of sale must be registered with an asset finance register, so that the public can check whether a vehicle has a bill of sale registered against it.
All charges to be imposed on borrowers in arrears must be disclosed before the contract is concluded by the lender and must only cover the lender's actual costs. If a borrower gets into difficulty, lenders must consider proposals for alternative payment arrangements and may only repossess the vehicle if attempts to make payment arrangements fail. Lenders must take all reasonable steps to ensure that repossessed cars are sold for the highest market price obtainable.
The Consumer Credit Trade Association will monitor compliance with the Code and suspend or expel any of their members who fail to comply; their details will be forwarded to the Office of Fair Trading (OFT).

This would be wonderful ammunition in a plead for unfairness in any litigation, perhaps the dealer should be reminded of this whilst you are awaiting your reply a about the validity of the BOS.

Peter

[labman]

Re: Voluntary Termination

HI


the new Code of Practice

Borrowers who are in arrears will be able to return the item purchased, such as a car, in full settlement of their debt. They will not be liable for any shortfall between the outstanding debt and the value of the vehicle.

That seems too good to be true if I'm reading it correctly. If the borrower is in arrears by even one month, they can hand the car back and walk away, scot free?

That would be better than a VT!

[Guest]

Re: Voluntary Termination

HI
Yes i think it refers to the principle, interst due under the agreement would still be arguable, however i think the early settlements regulations would apply since it would be a cca agreement.

It does however show that the dealer cannot just do as he pleases irrespective of the debtors difficulties.

Peter

[labman]

Re: Voluntary Termination

That sounds like some very good news indeed Terri!

[gixergirl777]

Re: Voluntary Termination

Really?? This does sound like good news.... although I took out my agreement on 04 JAN 11 just before this legislation came through - does this mean I would be covered by it? This does explain why I was never actually presented with any information on Bills of Sale - yet now there is a plain English document published on the ACF website.

Okay, so based on this does it sound like I can give the car back and walk away? Or do I have to actually pay the settlement figure in order to do this?

Looks like it will take approx 2 weeks to get confirmation of whether the BOS is valid from the courts.

Thank you both again for your help here, very much appreciated.

Same thing listed here, it really does say that I am in arrears I can give the car back as full payment (this must have been brought in to try to stop these extortionate finance agreements - such as my car is worth about £2500, I will have paid £11,000 by the end of the agreement if I carried on - I have already paid approx £6K)

http://nds.coi.gov.uk/content/Detail...1&NewsAreaID=2

[Guest]

Re: Voluntary Termination

I think if i were you i would mention the guidelines to them.

Tell them that you are of the opinion that the under the guideline the sum secured by the bill of sale has been paid.

The car is therefore released from the restriction.

The issue of any remaining sums due under the Fixed sum agreement in regards to contractual interests due on termination will be addressed with the credit provider.

Be interesting to see what they say
Peter