Santander Financial Services, Personal Contract Hire, early termination

[notsure]

I terminated my agreement for a Volvo XC60. It was on a 4 year agreement and I cancelled 5 months early (3years and 7 months into agreement). They collected the vehicle approx 4 weeks ago after a ridiculously over the top inspection (lasted 3 hours). I disputed the assessment on the day of collection.

Today (24/10) they have sent me a bill for £1566.28 as a "Damage Recharge Invoice" and £370.44 on an excess mileage invoice. I have still to receive the invoice for 50% of the value of outstanding payments - approx £1500.

As an example they are attempting to charge me £230 for a remote key missing which was a low battery on the spare car remote.

Can anyone advise on legal right here. Having used this forum before I knew roughly my rights on an HP deal but not sure if the legal position changes with a personal contract hire?

If anyone can point at the right letter template to use and any advice I would very much appreciate it.

Thanks in advance.

[R0b]

Typically, under a pure hire agreement you tend to have less rights to rely on, but I do hve a couple of questions.

1. How did you go about terminating the agreement, did you rely on something in the contract or your statutory right?

2. how much were your annual payments, did they exceed £1,500?

The starting point will always be the terms of the contract, so does it say anything about vehicle damage and how it's calculated? Normally damage is determined according to BVRLA fair wear and tear standards. Nevertheless you may still be able to challenge the damage they are claiming if they are unable to show the vehicle's condition at the time you first took possession of the car. All well and good claiming there is damage beyond reasonable wear and tear but unless the car was brand new and you were the only person who drove it, they would need to prove the damage was done whilst in your possession.

The alternative is that you argue that the damage being claimed would put Santander in a better position if they are claiming costs of repair to as new. Any damage should account for wear and tear over the hire period and that be deducted from the amount for that particular damage. In other words, you should only pay a percentage of the damage to bring it back to new.

As to excess mileage, don't think you have much of a leg to stand on with that one but I would have to double check. I would be refusing the charge for a new key if it was simply a low battery issue. Any claims for loss shouldn't put them in a better position than they would be, otherwise the you can argue the contract terms are unfair.

[notsure]

Hi Rob

thanks for the assistance, answers below

Typically, under a pure hire agreement you tend to have less rights to rely on, but I do hve a couple of questions.

1. How did you go about terminating the agreement, did you rely on something in the contract or your statutory right?
Something in the contract (50% of outstanding payments as a VT)

2. how much were your annual payments, did they exceed £1,500?
6k (£500 pm)

The starting point will always be the terms of the contract, so does it say anything about vehicle damage and how it's calculated? Normally damage is determined according to BVRLA fair wear and tear standards. Nevertheless you may still be able to challenge the damage they are claiming if they are unable to show the vehicle's condition at the time you first took possession of the car. All well and good claiming there is damage beyond reasonable wear and tear but unless the car was brand new and you were the only person who drove it, they would need to prove the damage was done whilst in your possession.

I purchased brand new (no other owners).

The alternative is that you argue that the damage being claimed would put Santander in a better position if they are claiming costs of repair to as new. Any damage should account for wear and tear over the hire period and that be deducted from the amount for that particular damage. In other words, you should only pay a percentage of the damage to bring it back to new.

As to excess mileage, don't think you have much of a leg to stand on with that one but I would have to double check. I would be refusing the charge for a new key if it was simply a low battery issue. Any claims for loss shouldn't put them in a better position than they would be, otherwise the you can argue the contract terms are unfair.

All further help gratfullly appreciated.

[R0b]

Hi Notsure,

I'm a little confused with your response to the first question. Unless times have changed, creditors would not normally allow you to VT after 50% of the payments have been made. There is a statutory right of VT for a hire only agreement under S.101 of the Consumer Credit Act but that only applies if your annual payments are less than £1,500.

Are you sure you have a PCH agreement and not a PCP agreement? That would make more sense with your reference to 50% payment of the total price and that would improve your rights/defence against excess mileage too. If you're unsure then you may want to upload the first page of your contract (make sure personal info redacted) and we can check but actually if you have the T&Cs available, it would be useful to see those too.

The only other thing I can think of is that you are not exercising a VT right rather you are allowed under the terms, to end the contract provided you agree to make a payment 50% of the remaining rental fees, is that correct?

[notsure]

Hi Rob

You're right, I articulated that badly. It is definetely a PCH (my first time ever doing one) and I was doing exactly as you mention in the last paragraph:

I am; "exercising a VT right rather you are allowed under the terms, to end the contract provided you agree to make a payment 50% of the remaining rental fees"

I will try to find the contract but any other suggested steps would be great.


I'm a little confused with your response to the first question. Unless times have changed, creditors would not normally allow you to VT after 50% of the payments have been made. There is a statutory right of VT for a hire only agreement under S.101 of the Consumer Credit Act but that only applies if your annual payments are less than £1,500.

Are you sure you have a PCH agreement and not a PCP agreement? That would make more sense with your reference to 50% payment of the total price and that would improve your rights/defence against excess mileage too. If you're unsure then you may want to upload the first page of your contract (make sure personal info redacted) and we can check but actually if you have the T&Cs available, it would be useful to see those too.

The only other thing I can think of is that you are not exercising a VT right rather you are allowed under the terms, to end the contract provided you agree to make a payment 50% of the remaining rental fees, is that correct?[/QUOTE]