BMW Financial Services - Voluntary Termination/Excess Mileage

[Dehaw]

Hi all

I’m late to this party as I only found/ read it yesterday, unfortunately I’m in a similar position to you all. I VT my car last year and received a ‘invoice’ for excess mileage, the process then began of disputing etc thereafter my credit file being targeted. As a result I’ve tecently been refused a mortgage and my credit card limit reduced. My score is currently very poor on Experian. I’ve now paid the charge at a 40% reduction. They basically had me over a barrel and I gave into pressure from my wife to pay it!!

Hi Cmilligan,

How did you come to the agreement of the 40% reduction? To me, that proves that they know this is unenforceable and will accept whatever offer if provided.

Did they also agree to remove all monthly marks from your credit file?

I contacted Callcredit to ask why BMW is allowed to go over the 6 month marking system that they provide where they should be taking me to court but yet to receive an answer.

[vipvipvip]

Hi CMililligan, sorry to hear that. Did they clear your markers on payment?

[Cmilligan]

Hi all

I’m late to this party as I only found/ read it yesterday, unfortunately I’m in a similar position to you all. I VT my car last year and received a ‘invoice’ for excess mileage, the process then began of disputing etc thereafter my credit file being targeted. As a result I’ve tecently been refused a mortgage and my credit card limit reduced. My score is currently very poor on Experian. I’ve now paid the charge at a 40% reduction. They basically had me over a barrel and I gave into pressure from my wife to pay it!!

[Dehaw]

Thanks for the reply R0b.

I totally agree it's extremely misleading! The car was VT'd slightly before that date shown, but that appears to be the date they actually reported it to credit reference agencies.

I wrote to BMW Financial Services several times about the way in which they were reporting things, highlighting how inaccurate and unreasonable it was. On one occasion I attacked it from the "refusal to issue a default" standpoint, and I received a hilarious email response:

Thank you for your email dated [REDACTED] of which your comments have been duly noted.

A Default Notice is required in the event of any breach under the terms and conditions whilst the agreement remains active. The Default Notice offers the customer an opportunity to remedy the breaches in order for the agreement to continue as normal. You exercised your right to Voluntary Terminate the agreement in June 2017. This means that you terminated the agreement with BMW Financial Services and returned the vehicle. As such, the agreement is no longer active and does not require a further Default Notice for Excess Mileage.

I can see from our records that you had raised a complaint regarding the Excess Mileage Charge which has been addressed by our Vehicle Logistics department and the Financial Ombudsman Service. As per their investigations, the charge remains due. It is not necessary for BMW Financial Services to impact your credit file further by applying a Default as it is not an accurate reflection of how your agreement ended. The charge became due on [REDACTED] and will incur late payment markers every 28 days of non-payment and until the full amount has been paid.

I honestly had no idea where to start in responding to that one. It's so ridiculous and incorrect it's genuinely laughable. It implies that a "default notice cannot/should not be reported" since the agreement is no longer "active". That would make sense, but, they have left the agreement active?

Plus, their understanding/definition of a default notice is incorrect. Default notices are issued to prevent the continual addition of missed/late payment entries until the end of time. They drop from an individuals credit file after 6 years (I believe), thus allowing the individual to at least have a chance of rebuilding their credit rating despite their earlier issues.

I've written to BMW UK, notifying them that I intend to take legal action if they do not work with BMW Financial Services to cease their illegal/illicit behaviours and repair the damage that has been done to my perceived credit worthiness. We'll see what their response is!

Either way, I need a resolution soon. Their continual inaccurate reporting to CRAs is becoming really quite damaging for me. I've just had enough of it frankly.

I'm still in the same boat KurtCrisco.

I've been living in Australia now since last September when this saga started and followed your journey, which isn't too different from my own and I agree with both yourself and R0b.

I only managed to check noddle (Call Credit) today via a VPN as that seems to be the only one they are updating, the one on Equifax or Clear Score shows no missed payments and my credit file there is unaffected so I can only assume that its the Call Credit system that's allowing them to get away with this, maybe worth reaching out to them?

I'll be in the UK in August, do you think it might be best if we brought our case together as one to take it to court or would it need to be done individually? Maybe if there is a group of people in the same position BMW might think twice?

[stuckcluckets]

From looking at that history on your account, I would definitely say that in my view it is inaccurate and misleading. A "delinquent" account is where you have missed so many monthly repayments. In your case, you have zero missed monthly repayments as can be seen from the green ticks, presumably that was the time you gave your notice of termination.

I can see that they have reported the account as VT, do you know when they reported to the credit agency (Experian I presume?) that you VT'd the agreement - is it that date as stated 01/7/2017, and is that correct?

I fail to see how an agreement can be terminated and yet BMW are entitled to continue to keep the account as 'open' or 'delinquent' reporting fees or charges as missed payments as if they were credit repayments. Let's not forget that the whole purpose of a credit reference agency is to assist other creditors in making an assessment as to whether or not you would be able to keep up with your credit repayments. Reporting fees or charges (which is a genuine unresolved dispute) in this way is, in my view, misleading because it does not provide any meaningful information about your creditworthiness. On the contrary, it gives off the impression that you are behind for over 6 months of your monthly instalments when in fact you made all repayments up to the point of termination. The correct route for BMW is for it to bring a claim to court for breach of contract but for obvious reasons is it is abusing its position to coerce you into paying up.

As for any claim, it would be a breach of data protection and/or negligence. There's no hard and fast rule about damages under breaches for data protection especially when it comes to inaccuracies of information as there is little case law to go off. My view is that the more aggravated the matter, the higher compensation you can demand. I think I already mentioned this but I would expect BMW to challenge it, and perhaps counterclaim for the outstanding balance. So there is a risk in doing this because there is no case law to base your claim around and it would come down to the arguments on the day and where a judge would see it justified to allow BMW to report your account as delinquent despite the fact that the agreement was terminated some time ago and your liabilities for credit repayments were extinguished.

Here's an extract from Experian's own guide on understanding your credit report (Link here):



You will see that it refers to status codes as showing "whether you have made your credit repayments over the past six years ..." I think it is quite clear that the excess mileage charges do not form any part of the credit offered and are incidental to it yet BMW are reporting those charges as if you have missed your credit repayments - key word in that description is credit. Add to the fact that the account is being shown as delinquent rather than closed in accordance with the date when you terminated the agreement is a further breach.

Ultimately it is your decision and I don't think any differently of you if you wished to make an offer to settle on the basis they will remove the markers. It's certainly a big decision for you to make so not one to take lightly. If you do choose to make an offer then I would suggest you get it in writing that they will remove all adverse entries and mark the account as closed (and that the settlement is in no way to be construed as an admission of your liability).

Of course BMW will take a different view to all of this, but it is also a risk to them in that if they did lose at court, it might not set a precedent but one can certainly refer to it as evidence for persuasiveness.

I have also requested a copy of the court case relating to RachRad who won her case on excess mileage, sadly the courts are taking so bloody long its been over a month and they still haven't located the transcript..

Thanks for the reply R0b.

I totally agree, it's extremely misleading! The car was VT'd slightly before that date shown, but that appears to be the date they actually reported it to credit reference agencies.

I wrote to BMW Financial Services several times about the way in which they were reporting things, highlighting how inaccurate and unreasonable it was. On one occasion I attacked it from the "refusal to issue a default" standpoint, and I received a hilarious email response:

Thank you for your email dated [REDACTED] of which your comments have been duly noted.

A Default Notice is required in the event of any breach under the terms and conditions whilst the agreement remains active. The Default Notice offers the customer an opportunity to remedy the breaches in order for the agreement to continue as normal. You exercised your right to Voluntary Terminate the agreement in June 2017. This means that you terminated the agreement with BMW Financial Services and returned the vehicle. As such, the agreement is no longer active and does not require a further Default Notice for Excess Mileage.

I can see from our records that you had raised a complaint regarding the Excess Mileage Charge which has been addressed by our Vehicle Logistics department and the Financial Ombudsman Service. As per their investigations, the charge remains due. It is not necessary for BMW Financial Services to impact your credit file further by applying a Default as it is not an accurate reflection of how your agreement ended. The charge became due on [REDACTED] and will incur late payment markers every 28 days of non-payment and until the full amount has been paid.

I honestly had no idea where to start in responding to that one. It's so ridiculous and incorrect it's genuinely laughable. It implies that a "default notice cannot/should not be reported" since the agreement is no longer "active". That would make sense, but, they have left the agreement active?

Plus, their understanding/definition of a default notice is incorrect. Default notices are issued to prevent the continual addition of missed/late payment entries until the end of time. They drop from an individuals credit file after 6 years (I believe), thus allowing the individual to at least have a chance of rebuilding their credit rating despite their earlier issues.

I've written to BMW UK, notifying them that I intend to take legal action if they do not work with BMW Financial Services to cease their illegal/illicit behaviours and repair the damage that has been done to my perceived credit worthiness. We'll see what their response is!

Either way, I need a resolution soon. Their continual inaccurate reporting to CRAs is becoming really quite damaging for me. I've just had enough of it frankly.

[Grahammcm1888]

Hi All

i just recieved this letter today. Presumably this is coming from BMW Finance as I have never had a problem with my credit before. My credit rating has started to deteriorate from last Month also. I assume the letter received is standard tactics from BMWFS?

[R0b]

From looking at that history on your account, I would definitely say that in my view it is inaccurate and misleading. A "delinquent" account is where you have missed so many monthly repayments. In your case, you have zero missed monthly repayments as can be seen from the green ticks, presumably that was the time you gave your notice of termination.

I can see that they have reported the account as VT, do you know when they reported to the credit agency (Experian I presume?) that you VT'd the agreement - is it that date as stated 01/7/2017, and is that correct?

I fail to see how an agreement can be terminated and yet BMW are entitled to continue to keep the account as 'open' or 'delinquent' reporting fees or charges as missed payments as if they were credit repayments. Let's not forget that the whole purpose of a credit reference agency is to assist other creditors in making an assessment as to whether or not you would be able to keep up with your credit repayments. Reporting fees or charges (which is a genuine unresolved dispute) in this way is, in my view, misleading because it does not provide any meaningful information about your creditworthiness. On the contrary, it gives off the impression that you are behind for over 6 months of your monthly instalments when in fact you made all repayments up to the point of termination. The correct route for BMW is for it to bring a claim to court for breach of contract but for obvious reasons is it is abusing its position to coerce you into paying up.

As for any claim, it would be a breach of data protection and/or negligence. There's no hard and fast rule about damages under breaches for data protection especially when it comes to inaccuracies of information as there is little case law to go off. My view is that the more aggravated the matter, the higher compensation you can demand. I think I already mentioned this but I would expect BMW to challenge it, and perhaps counterclaim for the outstanding balance. So there is a risk in doing this because there is no case law to base your claim around and it would come down to the arguments on the day and where a judge would see it justified to allow BMW to report your account as delinquent despite the fact that the agreement was terminated some time ago and your liabilities for credit repayments were extinguished.

Here's an extract from Experian's own guide on understanding your credit report (Link here):



You will see that it refers to status codes as showing "whether you have made your credit repayments over the past six years ..." I think it is quite clear that the excess mileage charges do not form any part of the credit offered and are incidental to it yet BMW are reporting those charges as if you have missed your credit repayments - key word in that description is credit. Add to the fact that the account is being shown as delinquent rather than closed in accordance with the date when you terminated the agreement is a further breach.

Ultimately it is your decision and I don't think any differently of you if you wished to make an offer to settle on the basis they will remove the markers. It's certainly a big decision for you to make so not one to take lightly. If you do choose to make an offer then I would suggest you get it in writing that they will remove all adverse entries and mark the account as closed (and that the settlement is in no way to be construed as an admission of your liability).

Of course BMW will take a different view to all of this, but it is also a risk to them in that if they did lose at court, it might not set a precedent but one can certainly refer to it as evidence for persuasiveness.

I have also requested a copy of the court case relating to RachRad who won her case on excess mileage, sadly the courts are taking so bloody long its been over a month and they still haven't located the transcript..

[Amethyst]

https://www.bbc.co.uk/programmes/b09nqnxd ( PT on PCP contracts re exact issue ( excess mileage on VT) on Moneybox in January ( 6.53 if you want to jump to that bit ) There hasn't been a ruling yet, and one is needed IMO to clarify this.

And yes he's one of the good guys IMO.

[stuckcluckets]

Off the wall maybe, but how about trying to make an appointment with your MP, explain the situation, that you are not alone & there are many people in the same situation, some MP's love to tilt at the windmill of big businesses, unless of course they agree with BMW & you are liable for the over mileage

It's a risky one, I might consider it though. I just have this feeling my MP would be on BMW's side.

I hadn't read back ( obviously sorry lol ). In your research into solicitors firms that could help have you tried speaking with pt2537 at Howlett Clarke ?

Can't say I did speak with Howlett Clarke no. Have you dealt with them and had good experiences?

[Amethyst]

I hadn't read back ( obviously sorry lol ). In your research into solicitors firms that could help have you tried speaking with pt2537 at Howlett Clarke ?

[Phaeton]

Off the wall maybe, but how about trying to make an appointment with your MP, explain the situation, that you are not alone & there are many people in the same situation, some MP's love to tilt at the windmill of big businesses, unless of course they agree with BMW & you are liable for the over mileage

[stuckcluckets]

You could make a formal complaint to the FInancial Ombudsman & ICO about the inaccurate reporting which would be less risk and cost than going through court.

pt2537

Thanks Amethyst, but I've already been down both routes.

The Financial Ombudsman were totally useless, and the ICO weren't far off. Have a look back through my thread, as there are plenty of posts about my dealings with the ICO in particular.

[Amethyst]

You could make a formal complaint to the FInancial Ombudsman & ICO about the inaccurate reporting which would be less risk and cost than going through court.

pt2537

[stuckcluckets]

Hi Kurt,

All I can say is good luck with your approach in terms of a getting a new car, but as for the small claims route, you can bring a claim for a sum of money because they are damaging your credit file which is causing distress and inconvenience. As for the amount of money, a starting point is £750 where a Court of Appeal awarded that amount where the creditor made a mistake as a one off. In your case, this isn't a one off, it is deliberate. I am amazed that they have continued to report late payments and not closed the account down almost 12 months after the account was VT'd but there we go.

Do you have another plan if BMW refuse to remove the adverse entries even if you agree to sign a new deal or make some financial payment?

Also, if you wouldn't mind, would you be able to send me a screenshot of the account as it shows on your credit report i.e. the status of the account and the late payment entries? Happy to receive it via PM if that is more comfortable for you, and make sure to remove all personal data.

R0b, it's been a while! Hope you're well!

So if I was to select a value that I perceive to be the level of damages that I'm owed, I could use that figure to start myself off down the small claims route? Do you have any further information about how this would work?

I don't really have another plan to be honest no. I contacted several solictors, all of whom refused to support the case unless I was willing to pay a huge upfront fee. They all viewed it as extremely high risk, with an unclear likelihood of success.

Please see screenshot below, illustrating how the BMW Finance account currently looks for me on Experian. I have no problem sharing this here with my personal details removed. People need to know how unjustly BMW Financial Services are behaving, and this is a good way to demonstrate that.

As you can see, we're currently at 9 missed payment entries, the 10th will be arriving in early June I expect. You can also see quite clearly how, instead of marking the account as satisifed, BMW Financial Services simply reduced the outstanding balance from £20.2k to the approx £2.1k they claim they're owed around the time of the Voluntary Termination. The missed payment entries increase numerically from 1 - 6 for the first 6, as this is the normal maximum expected before a default would be issued. All the further entries are then just marked with another 6, so the way in which BMW Financial Services are reporting my account is clearly confusing Experian's systems - understandably so, as BMW Financial Services are not reporting things fairly or correctly.

I spoke with another person who had experienced exactly the same. BMW Financial Services recorded a total of 24 missed payment entries in the end (with no default notice), before this particular individual finally gave in and sent them a without prejudice letter offering to pay the full balance, on the condition that all the missed payment entries were removed. BMW Financial Services accepted, and honoured the agreement. This individual should not have been bullied into paying the alleged sum in this way though. It's just so horribly unjust.

[R0b]

Hi Kurt,

All I can say is good luck with your approach in terms of a getting a new car, but as for the small claims route, you can bring a claim for a sum of money because they are damaging your credit file which is causing distress and inconvenience. As for the amount of money, a starting point is £750 where a Court of Appeal awarded that amount where the creditor made a mistake as a one off. In your case, this isn't a one off, it is deliberate. I am amazed that they have continued to report late payments and not closed the account down almost 12 months after the account was VT'd but there we go.

Do you have another plan if BMW refuse to remove the adverse entries even if you agree to sign a new deal or make some financial payment?

Also, if you wouldn't mind, would you be able to send me a screenshot of the account as it shows on your credit report i.e. the status of the account and the late payment entries? Happy to receive it via PM if that is more comfortable for you, and make sure to remove all personal data.