BMW Financial Services - Voluntary Termination/Excess Mileage

[Grahammcm1888]

I have just received a letter from BMW claiming I owe them money for excess mileage after a VT. I never signed their ‘“VT Pack” but admittedly was over in mileage. I don’t intend to pay this obviously beacause I now no longer have an agreement with them. I paid 50% and the car was in great condition. Here is what I believe my options are

1. Pay
2. Ignore
3. Write a letter protesting their charge.

I am looking for a bit of advice.

[kreig]

I have just received a letter from BMW claiming I owe them money for excess mileage after a VT. I never signed their ‘“VT Pack” but admittedly was over in mileage. I don’t intend to pay this obviously beacause I now no longer have an agreement with them. I paid 50% and the car was in great condition. Here is what I believe my options are

1. Pay
2. Ignore
3. Write a letter protesting their charge.

I am looking for a bit of advice.

Hi Graham,

I suggest you read through this thread and the others on the forum to hear other stories.

R0b in particular has some excellent posts and templates.

Chances are BMW will insist the payment is owed, the FO will find in their favour, the ICO will do nothing and BMW won't take you to court through fear of losing. As you will see there has been a recent court success which is fantastic, however this was where Mercedes brought the case to court. BMW do not seem to be keen on pursuing this route so if you wished to have your day in court you would have to bring the case against them at your cost & time.

If you don't pay what likely happens is that balance will sit on your account as owed, they will periodically chase you (Via an annual statement) for it but most damaging of all they will leave a late payment marker on your credit report. This took my 980+ score down to around 500. So the course of action you take I suggest you consider the likelihood of you needing to borrow money any time soon / take out a phone contract / get a new credit card or remortgage your house as that may have an impact.

Hope that helps.

[stuckcluckets]

I have just received a letter from BMW claiming I owe them money for excess mileage after a VT. I never signed their ‘“VT Pack” but admittedly was over in mileage. I don’t intend to pay this obviously beacause I now no longer have an agreement with them. I paid 50% and the car was in great condition. Here is what I believe my options are

1. Pay
2. Ignore
3. Write a letter protesting their charge.

I am looking for a bit of advice.

Hi there, I highly reccomend reading back through all of the previous posts in my thread which will hopefully provide you with some more information.

The upshot is that BMW Financial Services have no legal right to charge you for excess mileage in a VT scenario, but that won't stop them trying, as they're attempting to do with yourself. If you ignore it, they will report your credit account to credit reference agencies (CRAs) as still being open with the alleged balance outstanding (despite your recent VT) and will report a missed/late payment entry for every month until such time as you pay them. This is an underhanded attempt on BMW Financial Services' part to try and bully the likes of both you and I into paying what they allege is owed. If you write to them, they will likely at first send you a load of waffle trying to justify their attempts to manipulate the Consumer Credit Act into their favour, before then ignoring any further correspondence from yourself.

I've tried to fight BMW Financial Services in the following ways so far:
- Writing to them
- Financial Ombudsman
- Information Comissioner's Office (ICO)

So far, I've had no joy. There is a contributor to this thread who has recently won a legal case against Mercedes Benz Financial Services for this exact same scenario, and we are waiting on them uploading the court judgement details at the moment.

My only realistic remaining option is to issue court proceedings against BMW Financial Services, as I'm not willing to pay an amount that simply isn't due.

[Grahammcm1888]

The threatening letters have started to arrive , even although I did write to BMW to state that I was not due to pay any money as this was my right under the Consumer Credit Act (Section 100). I even suggested that I will take legal action if my credit rating is affected and/or the letters continue. A route I may have to go down in the future. It would be good to see the evidence of the winning case against MBFS to add some fuel to the fire against them.

[stuckcluckets]

The threatening letters have started to arrive , even although I did write to BMW to state that I was not due to pay any money as this was my right under the Consumer Credit Act (Section 100). I even suggested that I will take legal action if my credit rating is affected and/or the letters continue. A route I may have to go down in the future. It would be good to see the evidence of the winning case against MBFS to add some fuel to the fire against them.

The threatening letters won't last, they haven't for me at least. They just keep crushing your credit file by adding continual missed payment entries until you eventually give in. It's unjust, but it's what they do.

Unfortunately they'll ignore your letters. They shouldn't, but they do. In my case, they emailed me telling me to stop writing to them, informing me that all future correspondance from myself will be ignored. Clearly I annoyed them with all my legally and factually accurate letters. Boo hoo.

[stuckcluckets]

Apologies that it's been a long time since my last update folks, had some other priorities of late!

The missed payment entries are continuing to appear on my credit file on a monthly basis without fail. It's reached a silly amount now, nearing a whole year's worth.

I'm currently exploring the possibility of a new car from BMW at the moment, so my next plan of action is to tell the dealership with whom I'm going through that I'll "sign on the dotted line today" on the condition that the old account be marked as closed/satisfied and all missed payment entries be removed first. Since BMW UK and BMW Financial Services are directly affiliated, I'm hopeful that this plan might just work!

I've looked into the Small Claims Court route, but its all focussed around situations whereby an organisation owes an individual a sum of money, not the other way around. Essentially I'd need to issue a claim against BMW Financial Services for a sum of money to get the ball rolling, and I'm not sure how I'd pick out a value, let alone justify it. I suppose I could argue that I'm owed damages, but I have a feeling it'd end up being a non-starter.

If my "new car sale bait" method falls flat, then I think its time to consider a without prejudice letter to BMW Financial Services making them an offer. I'm loathed to do it, but frankly, my credit history has to come before my pride.

[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.

[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.

[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]

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.

[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

[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 ?

[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]

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.

[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..