Voluntary Termination of Car Finance

[DJ-1988]

Re: Voluntary Termination of Car Finance

Hi Rob, [MENTION=71570]R0b[/MENTION]

Had another reply, copied and pasted below:

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With reference to your e-mail dated 16^th December 2015. Please see below, as you stated,

"total price " means the total sum payable by the debtor under a hire-purchase agreement or conditional sale agreement, including any sum payable on the exercise of an option to purchase, but excluding any sum payable as a penalty or as compensation or damages for a breach of the agreement;

excluding any sum payable as a penalty or as compensation or damages for breach of the agreement. You were in Breach of your agreement with our client
by exceeding your agreed mileage.

Section ‘189’ of the CCA explains definitions within the CCA. As stated in the Act. Please see below.

(1) In this act, unless the context otherwise requires---

Your terms and conditions specifically section ‘excess mileage charge’, ‘The basic mileage is the permitted mileage under the terms of the agreement, calculated by multiplying the basic annual mileage shown in the mileage details section by the number of whole and/or part years that have passed since this agreement date, up to the date of calculation. Excess mileage calculations are based upon total paid months, allocated in monthly intervals, not a daily calculation up to the point of return (not how long you have the vehicle). You had made a total of 31 payments throughout your agreement.

You are liable for the excess mileage. I feel you need to obtain a second opinion on your legal rights.

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So basically, he's arguing that I am still liable? Is this not a penalty clause though? If it was a contractual term shouldn't it be proportionate...so for example if the car had done less miles the creditor should issue a rebate at the same rate? This wasn't in the contract so should be classed as a penalty and unenforceable? Or am I barking up the wrong tree? It's something I read on a site whilst looking into this initially?

[R0b]

Re: Voluntary Termination of Car Finance

Hi Rob, @R0b

Had another reply, copied and pasted below:

------------------------------------------------------------------------------------------------------

With reference to your e-mail dated 16^th December 2015. Please see below, as you stated,

"total price " means the total sum payable by the debtor under a hire-purchase agreement or conditional sale agreement, including any sum payable on the exercise of an option to purchase, but excluding any sum payable as a penalty or as compensation or damages for a breach of the agreement;

excluding any sum payable as a penalty or as compensation or damages for breach of the agreement. You were in Breach of your agreement with our client
by exceeding your agreed mileage.

Section ‘189’ of the CCA explains definitions within the CCA. As stated in the Act. Please see below.

(1) In this act, unless the context otherwise requires---

Your terms and conditions specifically section ‘excess mileage charge’, ‘The basic mileage is the permitted mileage under the terms of the agreement, calculated by multiplying the basic annual mileage shown in the mileage details section by the number of whole and/or part years that have passed since this agreement date, up to the date of calculation. Excess mileage calculations are based upon total paid months, allocated in monthly intervals, not a daily calculation up to the point of return (not how long you have the vehicle). You had made a total of 31 payments throughout your agreement.

You are liable for the excess mileage. I feel you need to obtain a second opinion on your legal rights.

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So basically, he's arguing that I am still liable? Is this not a penalty clause though? If it was a contractual term shouldn't it be proportionate...so for example if the car had done less miles the creditor should issue a rebate at the same rate? This wasn't in the contract so should be classed as a penalty and unenforceable? Or am I barking up the wrong tree? It's something I read on a site whilst looking into this initially?

He's missing the point and just latching onto breach of the agreement and not reading the definition of total price in the whole context. Seems like he has clearly missed out the word excluding breaches of the agreement. I wouldn't bother arguing with him, just a quick email to him and say you refer to your previous email, your position remains the same, he has clearly mis-read the definition and that you will ignore any further correspondence unless proceedings are issued, which of course will be defended in full. Continuous emails chasing the alleged outstanding amount without any intention of bringing a claim to court will be deemed as harassment and you reserve the right to take action against RMS Receivables as a result.

I wouldn't worry too much about it, if they really think the money is owed then they will try their luck in court which, I think won't get very far, and you can claim a small amount of reasonable costs for your troubles if it goes in your favour! It's all scare tactics and it's just someone on the other end who seems to have a lack of understanding in the law and is unable to interpret it properly.

[msderry]

Re: Voluntary Termination of Car Finance

Hi,sorry to jump on your thread but am desperate for advice.We only had our car on finance for a few months and had to terminate the agreement.The company was very good and had it collected within a week.They advised us that we would be responsible for just under £2400 which was 50% of the agreement less payments we had made.We have now been contacted by the company that collected the vehicle adding figures for damaged alloys and excess mileage(seems to be common place on the threads that I have read)Please could you advise me of what to quote at these people concerning how we can argue the things conveniently added in the contract.Seems we should have had a legal representative look at it before signing.we would never have entered into a contract with restricted mileage as we do a lot of running around.
We have no intention of trying to walk away from the 50% we are liable for and will come to arrangements to pay it.My husbands hours had been decreased dramatically over the last few months and it looks as though employment will cease in the very near future.We returned the car to avoid getting behind with payments.This company is now a third person and if I could find an amount they are asking for,the finance company itself would be my priority.They have said our excess mileage and refurb of wheels would be£770 reduced to £440 "as a good will gesture" if paid within the next week

[R0b]

Re: Voluntary Termination of Car Finance

Hi,sorry to jump on your thread but am desperate for advice.We only had our car on finance for a few months and had to terminate the agreement.The company was very good and had it collected within a week.They advised us that we would be responsible for just under £2400 which was 50% of the agreement less payments we had made.We have now been contacted by the company that collected the vehicle adding figures for damaged alloys and excess mileage(seems to be common place on the threads that I have read)Please could you advise me of what to quote at these people concerning how we can argue the things conveniently added in the contract.Seems we should have had a legal representative look at it before signing.we would never have entered into a contract with restricted mileage as we do a lot of running around.
We have no intention of trying to walk away from the 50% we are liable for and will come to arrangements to pay it.My husbands hours had been decreased dramatically over the last few months and it looks as though employment will cease in the very near future.We returned the car to avoid getting behind with payments.This company is now a third person and if I could find an amount they are asking for,the finance company itself would be my priority.They have said our excess mileage and refurb of wheels would be£770 reduced to £440 "as a good will gesture" if paid within the next week

Did you take any photos of the car prior to handing it over? Did you sign any inspection reports? what evidence have they supplied with? The car only need be in a reasonable condition, not pristine so as long as tthe car has been maintained sufficiently given its age then you should be alright on the damaged alloys, however that does depend on how damaged they are. minor scratch fine but if they are very badly damaged you may have to look at offering some kind of money towards it.

As for excess mileage, if you read the current thread here and this thread there's a sample letter I have created http://www.legalbeagles.info/forums/...RMS-Receivable which should help you.

[DJ-1988]

Re: Voluntary Termination of Car Finance

Just to give you an update Rob, after the last email I sent them (I didn't bother responding to him the last time as we had already previously stated that I wasn't going into anymore correspondence unless they were going to issue proceedings), all I have received is a couple of phone calls (which I ignored) and a couple of generic, automatic emails.

Not sure whether it is a good thing or a bad thing that they are so quiet. I am keeping a close eye on my credit rating in case they try to sneak in a default flag.

[R0b]

Re: Voluntary Termination of Car Finance

Good idea, I'd be very surprised if they attempted to bring this to court, they would't stand much of a chance I think

[hargreaves1992]

Re: Voluntary Termination of Car Finance

Hi,

Sorry - Instead of creating a new post I thought I could possibly jump on the back of this one.
I am thinking of doing the same in a couple of months - I'm located in Lancashire but purchased the car from Essex - Do they come and collect or do I have to drive down and return?

Kindest,

[TaylorNorman]

Re: Voluntary Termination of Car Finance

HI Guys

I recently decided to cancel my PCP as I was approaching the 50% mark and have bought a new car, I rang Toyota financial who in there defence were informative and happy to send me a cancelation letter.

I received the letter today, It states on the front if I sign I will be cancel my PCP and paying the upfront cost to bring it to 50% does that sound ok?

Also I am worried about excess charges due to mileage I believe I am over by around 6000 miles is there a law in place in which I can defend myself when they charge me?
Also I have scratched on 2 alloys do you reckon these will be pricey excess charges?

thanks again

Taylor

[DJ-1988]

Re: Voluntary Termination of Car Finance

HI Guys

I recently decided to cancel my PCP as I was approaching the 50% mark and have bought a new car, I rang Toyota financial who in there defence were informative and happy to send me a cancelation letter.

I received the letter today, It states on the front if I sign I will be cancel my PCP and paying the upfront cost to bring it to 50% does that sound ok?

Also I am worried about excess charges due to mileage I believe I am over by around 6000 miles is there a law in place in which I can defend myself when they charge me?
Also I have scratched on 2 alloys do you reckon these will be pricey excess charges?

thanks again

Taylor

Hi Taylor,

From my current experience, I would NOT sign the letter. It will probably have in there that you are liable for excess mileage etc. To Voluntary Terminate all you have to do is send them a letter stating you are voluntarily terminating your agreement with them. If you have already sent them a letter stating this and they are still trying to get you to sign something send them something along the lines of this:

In reply to your letter, I do not have to sign or fill in anything other than the notice letter (which was sent on xxx of xxxx 2016) and a condition report upon collection of the vehicle in order to facilitate a Voluntary Termination under the CCA. Again, could I request you arrange for someone to contact me so we can arrange collection of the vehicle.


If you haven't reached 50% yet, you can still VT at any point, you will just get an end of agreement bill that amounts to the shortfall between what you have currently paid and 50% of the liability under the agreement.

With regards to excess mileage, if you VT you only have to pay 50% of your liability under the agreement, and nothing else (unless any damage constitutes being above normal wear and tear). Be prepared for a long drawn out argument though. I Vt'd my vehicle in August and it's still not resolved.

With regards to damage, if you are worried, go and get them professionally repaired yourself. I have had mine refurbed for £20 a pop before to decent standard on a lease car I was returning, and they didn't bat an eyelid.

- - - Updated - - -

Hi,

Sorry - Instead of creating a new post I thought I could possibly jump on the back of this one.
I am thinking of doing the same in a couple of months - I'm located in Lancashire but purchased the car from Essex - Do they come and collect or do I have to drive down and return?

Kindest,

Hi,

The finance company will usually send someone to pick it up regardless of where you live. Make sure they don't try and charge you a collection fee as they aren't allowed to do this when you voluntarily terminate your agreement.

[DJ-1988]

Re: Voluntary Termination of Car Finance

Good idea, I'd be very surprised if they attempted to bring this to court, they would't stand much of a chance I think

Hi [MENTION=71570]R0b[/MENTION],

Speak of the devil, I have had more correspondence from them in the post today:

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We write with reference to our previous correspondence in connection with the above agreement and our clients claim for £xxx.xx in respect to vehicle xxxx xxx. We note from our records that despite several request for settlement, the above amount remains outstanding damage.

We now demand that you make immediate payment for the sum of £xxx.xx within the next 7 days, failing which our client reserves the right to issue legal proceedings against you, should any of the above sums remain unpaid.

You should note that if Court proceedings are necessary, any judgement obtained is automatically registered by the court in a centrally-based register which facilitates financiers such as Banks and Building Societies making credit rating checks against prospective borrowers. Therefore, any such entry registered against you may restrict any application for credit you may make in the future.

We therefore trust that your payment will be received at this office within the aforementioned time, and that no further steps will be necessary. Please contact RMS receivables as a matter of urgency to pay by debit or Credit card. Your remittance should be made payable to RMS Receivables and sent directly to this office quoting the above reference.

All further communications in respect of this matter should be addressed to us and quote the above reference.

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They have also put another page in which looks like a notice??

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This is a notice served under s86E of the Consumer Credit Act 1974 in relation to your Hire Purchase Agreement[s] number xxxxxxx dated xx/xx/xxxx

The terms of your agreement[s] allow us to charge you for the extra costs we incur if you are in default; that is, if you fail to keep to the agreed terms. You are in default and details of the charges we have added to you account are set out below.

Excess Mileage Charge

(There is a table here with how they have calculated the pro rata mileage and excess mileage charge)

In accordance with your terms and conditions of hire it is found that the vehicle has exceeded your contracted mileage. We refer you to the table above and the calculation used to illustrate this charge.

This notice does not take account of default sums which we have already told you about in another Default Sum Notice, whether or not those sums remain unpaid.

Yours Faithfully,

Peugeot Financial Services

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Shall I respond to this reiterating what has been said previously, or should I wait for them to issue court proceedings? Are they likely to issue court proceedings for this? I can't find any examples online of them doing so. If I did go to court and put the findings on here, would it help anyone in the same predicament?

[R0b]

Re: Voluntary Termination of Car Finance

Interesting, could be a scare tactic I think and again I have no idea why they are sending you a default notice because the agreement has been terminated so it no longer exists. Any amount they allege becomes a debt which now needs to be enforced through the courts and they cannot put a default notice on your credit file. If they attempt to do that in anyway I would be inclined to bring a claim against them incorrect reporting on your credit file and claim for compensation too.

As I explained on another thread, whether they decide to take you to court is ultimately a commercial one. The excess mileage they are claiming is £240.00 which if they were to instruct a solicitor to issue proceedings against you will cost at about £200-£400 and then the question of whether they instruct a barrister who will probably be junior will be another £500+. Of course they could do this all by themselves but as you can see, they don't really have a clue what they are doing or on about.

I would also say that you could counterclaim for a wasted costs order as they have no leg to stand on based on what the Consumer Credit Act says and is both a waste of yous, the courts and their time.

The question is whether you are prepared to go the distance and argue this in court or whether you will just give in and pay them. If you want to go all the way, I am happy to help prepare any defence and/or counterclaim should the issue proceedings. However based on the above the amount being claimed, I wouldn't see it as being commercially viable to do so.

[SamD1988]

Re: Voluntary Termination of Car Finance

Hi,

I have a car on finance that I wish to VT but after reading on other sites noticed that a lot of it states things like not being able to afford repayments etc. However that isn't my issue, my issue that the car has been nothing but problems and is still carrying on that way.

I am well over 50% paid on the agreement but just cannot justify dumping anymore money into it to just have something else go wrong.

The car has one mark on each bumper where they were scraped while shopping one day but that is it, I am not aware of any mileage restrictions on my agreement so I cant imagine that being an issue but just need as much advice as possible regarding this before I go ahead and do it to only get it thrown back at me saying I'm not able to VT my agreement.

Thank Sam.

[R0b]

Re: Voluntary Termination of Car Finance

Hi,

I have a car on finance that I wish to VT but after reading on other sites noticed that a lot of it states things like not being able to afford repayments etc. However that isn't my issue, my issue that the car has been nothing but problems and is still carrying on that way.

I am well over 50% paid on the agreement but just cannot justify dumping anymore money into it to just have something else go wrong.

The car has one mark on each bumper where they were scraped while shopping one day but that is it, I am not aware of any mileage restrictions on my agreement so I cant imagine that being an issue but just need as much advice as possible regarding this before I go ahead and do it to only get it thrown back at me saying I'm not able to VT my agreement.

Thank Sam.

Hello,

Your starting point would be to read through this guide -> http://www.legalbeagles.info/forums/...on-Your-rights

If you have any problems after that, I suggest you create your own thread and tag me using [MENTION=71570]R0b[/MENTION] (its a zero not the letter)

[Capricorn95]

R0b Hi

I have applied for voluntary termination on my car but received this response back. Just wanted to check that right and I’ll just have to wait it through? I could have sworn I signed up for a PCP and the amount I pay for the car I have is ridiculous so wanted to end it ASAP. This is with FCA automotive:

‘Thank you for your email and letter.

The type of agreement that you hold is a Motor Loan Plus (please see attached copy of agreement) whereby you are the legal owner of the vehicle and we do not hold any financial interest in the vehicle.

The finance is secured against yourself, not the vehicle and is similar to a personal/bank loan.

For this reason, unfortunately you do not have the option to Voluntarily Terminate the agreement and return the vehicle to us like you would with a PCP or Hire Purchase agreement.

You may sell the vehicle and settle the finance in full (settlement figure attached), partially or simply continue to pay your monthly instalments. Please bear in mind that you have a balloon payment due on27/04/2020 of £4,276.00.

You may also have the option to return the vehicle at the end of the contract once you have paid your last normal monthly instalment (27/03/2020) if the vehicle is under the agreed mileage (20,050 miles). The End of Contracts team will then make a decision as to whether we will accept the vehicle as a Hand Back, this is not guaranteed.

Should you wish to discuss this further, please do not hesitate to contact me.


Thanks in advance for any help,
capricorn95

[Capricorn95]

R0b Hi

I have applied for voluntary termination on my car but received this response back. Just wanted to check that right and I’ll just have to wait it through? I could have sworn I signed up for a PCP and the amount I pay for the car I have is ridiculous so wanted to end it ASAP. This is with FCA automotive:

‘Thank you for your email and letter.

The type of agreement that you hold is a Motor Loan Plus (please see attached copy of agreement) whereby you are the legal owner of the vehicle and we do not hold any financial interest in the vehicle.

The finance is secured against yourself, not the vehicle and is similar to a personal/bank loan.

For this reason, unfortunately you do not have the option to Voluntarily Terminate the agreement and return the vehicle to us like you would with a PCP or Hire Purchase agreement.

You may sell the vehicle and settle the finance in full (settlement figure attached), partially or simply continue to pay your monthly instalments. Please bear in mind that you have a balloon payment due on27/04/2020 of £4,276.00.

You may also have the option to return the vehicle at the end of the contract once you have paid your last normal monthly instalment (27/03/2020) if the vehicle is under the agreed mileage (20,050 miles). The End of Contracts team will then make a decision as to whether we will accept the vehicle as a Hand Back, this is not guaranteed.

Should you wish to discuss this further, please do not hesitate to contact me.


Thanks in advance for any help,
capricorn95