PCP/Fixed sum loan

[margaretrussell]

Hi wondering if anyone can help, I have a Volvo through which I thought was PCP but when I tried to return the vehicle I have found that the I have a fixed sum loan with Santander. Volvo salesperson arranged this. The Volvo paperwork says PCP but Santander says it is a Fixed sum loan. I am trying to voluntarily surrender the car but think this is not possible due to the type of finance.

Margaretrussell

[Kati]

Re: PCP/Fixed sum loan

tagging [MENTION=71570]R0b[/MENTION] xx

[R0b]

Re: PCP/Fixed sum loan

Hi Margaret,

Did you sign the Volvo paperwork plus the Santander paperwork together, or just the Volvo paperwork? Depending on the discussions you had with Volvo it is possible that they may have misled you which could give rise to a claim for misrepresentation if you were under the impression that it was on a PCP contract, not a fixed sum loan.

It would be helpful if you could provide a copy of the documents from Volvo and Santander - you can email Kati@legalbeagles.info and she can upload them for you.

If it is really a fixed sum loan, the car is legally owned b you, so you can sell it off but it may not cover the cost you owe to Santander.

[margaretrussell]

Re: PCP/Fixed sum loan

Hi
The Santander paperwork says Fixed sum loan from Volvo, I do not have a signed copy. I did a check on the car as I tried to sell it and it has advised that there is finance on the car in the form of PCP (HPI check). The finance house on the check is Santander Consumer Finance (UK) PLC. I have no idea what to do as I am unable to sell the car or voluntary surrender.

Margaretrussell

[R0b]

Re: PCP/Fixed sum loan

You should have been given a copy by Santander when you took out the finance. In any event you can request a copy by contacting them.

When you say you did a check on the car, how did you do this and when and do you have any evidence which shows the car is on PCP?

The agreement can only be a PCP which allows you to voluntary terminate the agreement or a fixed sum loan which is basically a loan but the ownership of the car belongs to you.

Be careful with your words, voluntary surrender is not the same as voluntary termination, the former meaning you will be liable for more than you wold be under VT.

[margaretrussell]

Re: PCP/Fixed sum loan

Hi Rob thank you for your advice, sorry for delay in replying. Between Volvo and Santander they have now decided the car is financed with PCP. I have already given a VT letter to volvo. Volvo manager has advised Santander have stated there is no 1/2 or 1/3 clause on their PCP so I cannot VT, can anyone advise?

[R0b]

Re: PCP/Fixed sum loan

Have you got that in writing form either Santander or Volvo that the agreement is a PCP not a fixed sum loan?

[margaretrussell]

Re: PCP/Fixed sum loan

Hi Rob, yes I have a print out from Volvo stating finance is PCP.

[R0b]

Re: PCP/Fixed sum loan

If they have agreed the finance is based on a PCP agreement, then they would be in breach of the CCA because you cannot contract out of VT. It is a statutory right and you should insist on it. If not, follow up with a complaint. If you need me to look over anything let me know.

[Mattt]

Re: PCP/Fixed sum loan

Just found this thread.

I'm in the same position, and have also come across someone else with the same situation last week - so there seems to have been a trend with Volvo/Santander switching people away from PCP without properly informing them.

In my case I have the pre-contract agreement definitely as a PCP (mentions VT rights) and the email chain where we ordered (also as a PCP) but then the final paperwork was done as this fixed sum loan thing - without informing us of the real implications. We were told "it was as we had a good credit score".

[Woody86]

Re: PCP/Fixed sum loan

Hi all,

I have a very similar problem and I'm in desperate need of help/advice.

I bought a Volvo in 2014 and the agreement and terms explained to me by the salesman we're that of a PCP.

I paid an initial deposit, fixed monthly payments and there was a final payment of 11k. There was also an excess mileage charge.

Due to a change in circumstances, I was left unable to afford the car any longer and attempted to VT the agreement. I was told by Santander that I had no right to do so and to refer to my agreement.

On closer inspection and after googling the problem, I found I had a fixed sum loan rather than the PCP agreement I had understood I was signing up for. I know I've been silly not being more careful what I sign.

After a complaint to Santander, I received a reply fobbing me off, saying you signed the agreement, it's your problem. Interestingly, Santander refer to the agreement as a personal loan PCP in their reply to me, saying that it doesn't have the same rights as a Conditional sale PCP. An admission I thought - surely it's a PCP or not and they had just admitted it was...

How wrong I was.

I've subsequently complained to the Ombudsman that the product was mis-sold and they seem to agree that Santander haven't been clear in what they're selling.

The problem I have is that even holding the opinion above, the Ombudsman looks to be siding with Santander and have the same conclusion that, I signed to contract, it's my problem. I'm absolutely shocked.

The Ombudsman are saying that they can't comment or judge based on the salesman's actions, because they can't prove it and the bottom line is what the contract says.

In summary,

1. The agreement is structured as a PCP (deposit, payments, final payment, guaranteed value, excess mileage fees etc).

2. The salesman led me to believe it was a PCP and certainly didn't ensure I fully understood the contract he was giving me.

3. Santander are still even now, after my complaints, referring to it as a type of PCP (but not the type that gives me any rights). They've also threatened to send someone to take possession on 'their goods', after previously telling me that the agreement being a loan rather than a PCP means I own the goods from the start, not them. They have also allocated debt collectors who are now harassing me.

I'm really at a loss as to what to do, but it appears this is a regular occurrence with Santander and Volvo so I'm almost certain I'm not wrong - hence my shock at the Ombudsman's decision.

Can anyone offer any advice on any steps I can take, or am I just done for?

I'd be very interested to hear from the initial poster, if their finance documents said 'Fixed sum loan' and it subsequently transpired to be a PCP agreement it could help me massively.

Thanks in advance.

[R0b]

Re: PCP/Fixed sum loan

Evening,

Woody, can you confirm if the Decision from the FOS is the final decision or is this the initial decision that they have produced. Normally the initial complaint is carried out by a junior and if you are not happy you can make a further appeal and seek a final decision from a senior Ombudsman (they are a bit of a joke at times)

Have you kept any pre-contract information from Volvo at all? When you signed the Santander Agreement did they give you a second pre-contract information document at the same time?

Did you pay yor deposit by credit card and the deposit amount £100 or more?

It sounds as if the agreement is terminated if they have instructed debt collectors, is this the case? Did you stop paying, if so when? Have Santander terminated the agreement already? Is there a default on your credit file?

[Woody86]

Re: PCP/Fixed sum loan

Hi Rob,

The FOS decision is at the initial junior level I believe. I have advised them today that I wish for the case to be progressed to the more senior level. It isn't looking good though.

None of the documents I can find that go with the finance agreement make any mention of 'PCP', but nor do they make any reference to a 'fixed sum loan', they're mostly details of payments, excess mileage fee details and final payment options just printed on plain paper. They look pretty clear of any titles or specifics as to the type of agreement (deliberate I would think). The only document that says fixed sum loan is the agreement itself but prior to researching this problem, I had no way to understand the agreement, other than the salesman's explanation.

I paid a £289 deposit, not sure if it was credit or debit card - I could find out if it will help? Then fixed monthly payments with a balloon payment at the end.

Up until the change in circumstances I had never missed a payment or managed the account badly - since the change I'm struggling to get enough together each month for the mortgage. Once I began suffering financial problems I attempted to VT as I thought I could and that's when this started. I'm now stuck with the depreciating car, escalating debts and the risk of further action.

Santander did add defaults due to me being unable to pay.

Santander haven't informed me the account has been terminated, but it took them a month and repeated missed deadlines to reply to the FOS so they've not really behaved well throughout and I'm sure they haven't done things right. My last contact with them was when they responded to my initial complaint and I said I would refer things to the FOS and await that outcome.

Hope this helps, thanks for your reply.

[R0b]

Re: PCP/Fixed sum loan

Is there anything in the documents that explain about your right to VT?

I'd have to see the the contract to fully understand what it is you've been given. From a legal perspective, it's not what the title of the document says but what the actual terms and conditions state and whether or not it is consistent with a hire purchase or a fixed sum loan.

From what you have said, the terms appear more akin to a hire purchase agreement rather than a fixed sum loan agreement. Under a fixed sum loan, ownership of the goods will pass to you immediately and you will generally pay a fixed monthly instalment until the end of the agreement. It's basically a loan that you would normally obtain from the bank except the price is used specifically for the car.

For a contract to be a hire purchase there are two conditions that would need to be met:

1. The goods are hired under the agreement in return for periodical payments i.e. the monthly instalments
2. Ownership transfers when the terms of the agreement is complied with. This can be one of the following but is most often (a):

(a) The exercise of the option to purchase (this is the one off payment at the end)
(b) either party does an act specified in the contract
(c) an event specified in the contract occurs

A conditional sale is almost identical to a hire purchase agreement except that the you agree to pay the balloon payment at the end. Both types of contracts allow for VT, a fixed sum loan does not because of the ownership passing immediately.

Do you remember you sending the VT notice to Santander and do you have a copy of it? Did you receive any response in writing that you can't do it? If not, then to protect yourself perhaps at a later point is to get this done immediately in writing, because as soon as Santander terminate the agreement you have lost that right altogether.

The FOS aren't great at these things and they tend to look at these types of complaints based on what the documents state. They're not legally trained and look at whats fair and reasonable, which is why you might get a completely different view between the FOS and the Courts. And your not obliged to accep the FOS's decision, if you do then it does become legally binding.

If the FOS do not find in your favour, what are you going to do? It is possible that Santander will bring a claim against you for the recovery of damages outstanding under the agreement. So before that happens you could either come to an arrangement to repay the amount off based on your affordability or defend the matter in court, and perhaps have a defence for the fact you gave notice to VT, and potentially a claim for misrepresentation, and possibly other defences based on what the agreement actually says.

At the moment however, you definitely need to keep all correspondence in writing, documents and any letters sent by post should keep proof of postage receipts in case you need it at a later stage. A timeline of events is definitely worth doing and keeping track of so you can see at a glance, what you've done and explain what has happened.

Going to court is certainly not a decision you should take lightly as it can be very stressful and there is always the risk that you could lose, end up with a CCJ which will have over the next 6 years obtaining credit/mortgages.

If you want to upload the documents on here, personal info removed I can take a look and them and see if there is anything in particular that sticks out.

The reason why I asked about whether you paid by credit card, even £10, is because you could potentially claim the full balance of the agreement via your credit card company for misrepresentation. Under s.75 of the CCA, any charges over £100 paid using a credit card (in part or in full) means that the CC Company is jointly liable with the lender for any breach of contract or misrepresentation - provided that you have a reaosnable argument.

[sj4201]

I am also in this same position due to Volvo and Santander!