Hello and question regarding PCP Termination

[woodoo]

Hello to everyone.

I have recently terminated my PCP and I have been informed of a contractual sum of money due towards my GAP insurance and Service Plan and if I don't pay it I will receive a V marker on my credit score? Can anyone advise if this is correct? Thank you in advance

[R0b]

Hello

Were you told that over the phone or do you have it in writing. They can apply a VT marker because that's factually correct but I've never heard of a "V" marker on a credit file.

Have they accelerated the payment for the GAP and Service Plan as a lump sum or are they suggesting that you continue your monthly payments?

[woodoo]

Hello

Were you told that over the phone or do you have it in writing. They can apply a VT marker because that's factually correct but I've never heard of a "V" marker on a credit file.

Have they accelerated the payment for the GAP and Service Plan as a lump sum or are they suggesting that you continue your monthly payments?

Hello Rob

I have cut and pasted the exact statement sent to me in a email and just removed the figures. I'm not 100% sure if I have to pay this or not?

I note that you have £XXX remaining as the contractual amount due towards your GAP insurance and Service Plan You can make this payment by calling us on the number below or by bank transfer using the attached details.

Provided this balance is settled in full within 28 days, a default will not be recorded on your credit file and only the “V” marker will show which is not adverse. You can make an arrangement to pay by calling our Collections team on 0344 561 4738 however please note that this would be reflected on your credit profile and be visible to other lenders.

Does this help in anyway? Thank you for your response

[R0b]

Who is the finance company?

Assuming there's nothing in the terms that contradict, you could argue that the GAP and service plan are separate agreements and since you have only agreed to terminate the HP contract, the finance co. is in breach because it has proceeded to terminate the GAP and service plan arrangement without your consent, it's a wrongful termination that amounts to a repudiatory breach. Once you communicate acceptance of that breach, you are discharged from all primary obligations i.e. to repay the outstanding amount.

Example wording below but you may want to amend according to your preferences - hopefully makes sense.

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

Dear XXX,

Thank you for your email [today or on (date)].

Whilst I acknowledge that my hire purchase agreement included GAP insurance and a service plan ("Additional Products"), these were separate agreements albeit rolled into one single payment. You will note from my termination letter that I gave notice under Section 99 of the Consumer Credit Act 1974 to terminate the hire-purchase element. At no point have I indicated to you that I am also seeking to terminate the current arrangements with respect to the Additional Products yet you have, of your own volition, proceeded to treat those arrangements as coming at an end at the same time as the hire-purchase agreement.

You will recall that it was agreed at the time of entering into the hire-purchase agreement that the cost of the Additional Products would payable by monthly instalments over the term of the hire-purchase agreement, that is X months. By unilaterally deciding to end that arrangement without any lawful justification and demand accelerated payment of the outstanding amount, you have substantially deprived me of my rights under the arrangement, which was to pay by instalments. For these reasons, it is therefore my opinion that [finance co.] are in repudiatory breach of agreement relating to the Additional Products, which is further confirmed by your demand of the outstanding amount and threat of a default being recorded on my credit file. This email serves as notice that I am accepting the repudiatory breach and ending the arrangement, with the effect being that I am discharged from all obligations regarding the repayment of the Additional Products.

On a final note, I would discourage you from any attempt to mark my credit file regarding the hire-purchase agreement as being in default. In doing so, you will be reporting inaccurate information to credit reference agencies and will of course have a negative impact on any future attempt for be to obtain credit. If I discover that a default marker has been reported by [finance co.] (and I will not accept your excuse that it was an administrative error and/or it was due to an automated process) then I will not hesitate to issue legal proceedings for an action in negligence, breach of data protection and/or any other action that may be applicable.

I trust the above makes my position clear and I do not consider it necessary to have protracted discussions on the matter. However, please do confirm that you will proceed to close my account and notify the appropriate parties (including credit reference agencies) that the hire-purchase agreement has been terminated.

[woodoo]

[QUOTE=R0b;n1461084]Who is the finance company?

Assuming there's nothing in the terms that contradict, you could argue that the GAP and service plan are separate agreements and since you have only agreed to terminate the HP contract, the finance co. is in breach because it has proceeded to terminate the GAP and service plan arrangement without your consent, it's a wrongful termination that amounts to a repudiatory breach. Once you communicate acceptance of that breach, you are discharged from all primary obligations i.e. to repay the outstanding amount.

Hi Rob

Firstly, many thanks for the response and I think its worth a try at least.

To answer your question, the finance company are FCA Automotive. I feel I should try to fight this as after all the GAP/Service Pack/ and as it turns out, the Tow hitch are all included under the total loan agreement and was not split or itemised on my monthly finance. I also haven't been supplied an itemised invoice to show how they have worked this calculation out and have to assume that they are 100% correct.

I very much appreciate your help in this matter and I will of course update you to let you know what their response will be.

[R0b]

If it is FCA then you may wish to double check the agreement. I'm sure there is a clause in there that states that additional products are deemed to be separate agreements to the HP element. If it is in there then you should refer to that clause which will stack up your argument that they've terminated without your consent or reason to do so.

[woodoo]

If it is FCA then you may wish to double check the agreement. I'm sure there is a clause in there that states that additional products are deemed to be separate agreements to the HP element. If it is in there then you should refer to that clause which will stack up your argument that they've terminated without your consent or reason to do so.

Hi Rob

I have looked through my contract and they haven't supplied the full terms and conditions with all the clauses and I can't find it anywhere to download. However I have noticed that in the PCP agreement I have from them that they clearly state

"You have the right to end this agreement. To do so, you should write to the person you make the payments to. They will be entitled to the return of goods and to half the total amount payable under this agreement, that is £(figure shown) If you have already paid at least this amount plus any overdue instalments and have taken reasonable care of the goods, you will not have to pay more."

In this section it does not list any clauses or sections/additional products that may alter the figure they have given me.

I'm going to give it a go. After all their document clearly states that very simply and without any Asterix or clause numbers

I will keep you updated.

[woodoo]

Hi Rob

I have looked through my contract and they haven't supplied the full terms and conditions with all the clauses and I can't find it anywhere to download. However I have noticed that in the PCP agreement I have from them that they clearly state

"You have the right to end this agreement. To do so, you should write to the person you make the payments to. They will be entitled to the return of goods and to half the total amount payable under this agreement, that is £(figure shown) If you have already paid at least this amount plus any overdue instalments and have taken reasonable care of the goods, you will not have to pay more."

In this section it does not list any clauses or sections/additional products that may alter the figure they have given me.

I'm going to give it a go. After all their document clearly states that very simply and without any Asterix or clause numbers

I will keep you updated.

Hi Rob

Just an update. I have pushed hard today and they have sent the case to their customer team to review. However, looking through the T&C's they have supplied I think I have found the clause they are using?

It's a bit hidden and on the paperwork it doesn't refer these clauses in the Termination section of the paperwork. I have challenged it by saying that I feel their pain , however they have not made it clear in the termination settlement figure that clause 14 and subsequent 14.1 14.2 (a) (b) and (c) may apply.

I'm probably clutching at straws here and may have to end up paying the bill however, its worth a try.

This is the cause in the T&C's

14.____Separate Agreements

14.1___The provisions and clauses of this document have been written in the plural

because it is designed to be used as an HP agreement combined with an

insurance/warranty/gap/other loan. If you do take out such a loan with us

then clause 14.2 below will apply; if you do not do so then this will only be

an HP agreement and all of the provisions and clauses of this document

must (where appropriate) be read and/or construed in the singular.

14.2___The HP and Loan agreements are separate legal contracts. Accordingly:

(a)____the sections headed “Termination : Your Rights” and “Repossession : Your

Rights” apply only to the HP agreement and payments made by you under

the loan do not count towards the payment figures set out in these sections;

(b)____if you exercise your right to terminate the HP agreement early, your liability

under that agreement is limited as set out in the section headed

“Termination : Your Rights” and clause 11.1 above. You will, however, still

be liable for the full balance due under the Loan agreement (less any rebate

that you are entitled to under the Consumer Credit Act 1974 if you settle

early);

(c)____any payment received from you which is less than the aggregate of the

sums immediately payable by you under each agreement will (unless you

tell us otherwise) be divided between the agreements in the proportions

those sums bear to each other.


This is the exact wording in the Termination figure box

"You have the right to end this agreement. To do so, you should write to the person you make the payments to. They will be entitled to the return of goods and to half the total amount payable under this agreement, that is £(figure shown) If you have already paid at least this amount plus any overdue instalments and have taken reasonable care of the goods, you will not have to pay more."


What I am trying to say is that it should be clear under TERMINATION figure clauses 14, 14.1, 14.2 (a) (b) (c) should have been specified here to clarify the Separate Agreements.

The only reference to section 14 of the clauses is right at the end of the whole contract under a heading Important. It then refers to the Insurance/Warrenty/GAP/Other Loan being Separate Agreements.

As I said, I think I am pushing luck here but a small detail like putting (refer to clause 14) in the Termination section would be more prudent?

Will see what happens, you never know!

[R0b]

The "Termination: Your Rights" box is a statutory statement that must be included by law; it can't be modified in any way.

I'm not sure I follow your argument to be honest. Clause 14 makes it clear that the GAP and service plan are separate agreements (think of it as 3 separate mobile phone contracts).

You agreed that the GAP and service plan would be paid over the term of the HP contract. Clause 14 clear says that exercising your right to terminate does not affect the contractual obligations for the GAP and service plan.

FCA terminated those contracts for no lawful reason and without your consent and then proceeded to demand the outstanding balance effectively altering the pre-agree arrangement. They are in breach of contract due to which is a wrongful termination and in legal speak is a repudiatory breach I.e. goes to the heart of the contract. If I recall theres nothing in the agreement that says they can terminate at any time and if there was, that's likely to fall foul of the unfair contract terms rules.

There's no trick or complex argument to this, it's very much straightforward contract law 101. If you want to still pay up, that's up to you but the moment you pay, it's generally considered an admission and you wont be able to recover it if you want to dispute in the future.

[woodoo]

The "Termination: Your Rights" box is a statutory statement that must be included by law; it can't be modified in any way.

I'm not sure I follow your argument to be honest. Clause 14 makes it clear that the GAP and service plan are separate agreements (think of it as 3 separate mobile phone contracts).

You agreed that the GAP and service plan would be paid over the term of the HP contract. Clause 14 clear says that exercising your right to terminate does not affect the contractual obligations for the GAP and service plan.

FCA terminated those contracts for no lawful reason and without your consent and then proceeded to demand the outstanding balance effectively altering the pre-agree arrangement. They are in breach of contract due to which is a wrongful termination and in legal speak is a repudiatory breach I.e. goes to the heart of the contract. If I recall theres nothing in the agreement that says they can terminate at any time and if there was, that's likely to fall foul of the unfair contract terms rules.

There's no trick or complex argument to this, it's very much straightforward contract law 101. If you want to still pay up, that's up to you but the moment you pay, it's generally considered an admission and you wont be able to recover it if you want to dispute in the future.

Hi Rob

I knew I was clutching at straws!! However, I'm holding out for the time being.

I had three items in this section. The GAP, Service plan and a tow hitch. If I have to pay anything I was going to offer a deal to pay the GAP and Service plan but get the tow hitch part removed as its being returned with the car???

The problem is I don't want to get a mark on my credit report and I think they have me by the short and curlies on this one :-)

Thank you for your advice and guidance