Voluntary termination refused

[Danmurray1]

Hi,

I have written in writing exercising my right to vt under the credit consumer act section 99 and received back the below.

"please find attached a copy of your credit agreement. Under the terms of your agreement you do not have the right to voluntary terminate"

Also they have offered to take the car and sell at auction for me at a fee.

I checked and can't find any vt mentioned in my contract however does the consumer act not override this? My agreement is a PCP finance with a balloon payment at the end.

Any help is greatly appreciated, stuck in this situation at the moment.

[R0b]

Re: Voluntary termination refused

A PCP is similar to a hire purchase, where you hire the agreement with the option to purchase. Difference mainly being PCP's generally offer lower monthly rates with higher balloon (option to purchase) at the end. If there is no right then that would mean its a hire agreement e.g. a lease. A PCH which is a personal contract hire is another example where you wouldn't be able to VT. VT only applies to agreements which are hire-purchase or conditional sale agreements.

Are you able to upload the agreement with your personal info removed? Would need to see all pages to understand your position.

Who is the finance company by the way?

[Danmurray1]

Re: Voluntary termination refused

Hi Rob,

Please see the attached.

I remember being told it was a PCP finance at the time and it is with Santander.

thank you.

[R0b]

Re: Voluntary termination refused

On initial look at the agreement, this is a fixed sum loan agreement which is essentially the same as taking out a loan from the bank. I have two points that coul be raised, firstly on a fixed sum loan agreement, ownershp of the vehicle passes to you, however I am not able to see anything on the agreement that relates to this point.

Secondly, the final document doesnt seem to really sit with the rest of it, where has that document come from? It says Sales Agency Agreement, it seems like there is missing pages here. Are you sure this is all the paperwork you received?

[Danmurray1]

Re: Voluntary termination refused

This came back with the rest today from them, I have checked back on my original copies i had and that final page was not included.

Also i found another agreement sheet what states "PCP" at the top left (see attached) which was with the copies i was given initially.

Am i right in thinking if it is a PCP the 50% VT applies even if it is not written in the terms and conditions on the contract? or is that not always the case

[R0b]

Re: Voluntary termination refused

It seems a bit confusing and I think if you were given the PCP information but it turns out that it was a Fixed Sum Loan then there could be potential for a misrepresentation here. As I understand it, a fixed sum loan is essentially a personal loan which is fixed in equal monthly instalmnts until paid off. In the front page of your agreement there is 48 monthly instalments with a final one off payment of £5k, that to me would indicate a conditonal sale/PCP agreement as opposed to a fixed sum loan.

I wasn;t aware Santander did fixed sum loans as my previous one with them was a conditional sale agreement but i guess it might depend on the the cost of the vehicle. Why do I think you have a case against them? Because Santande acknowledges that a fixed sum loan is a fixed amount over a period of time, see this link here -> https://www.santanderconsumer.co.uk/...ixed-sum-loan/

Therefore tht final monthly repayment would not indicate that it is a fixed sum loan, and given that you were expecting it to be a PCP agreement with the documentation, thats what it should be, which of course would give you the right to VT.

Don't suppose you paid any deposit by credit card or anything which was £100 or more?

[Danmurray1]

Re: Voluntary termination refused

I see seems a bit of both but I definitely remember him selling it to me as a PCP finance deal.

I don't think I did pay any deposit for it, will have to double check back but can't find any paperwork in my car pack.

What would be the best way to proceed?

[R0b]

Re: Voluntary termination refused

I think the next steps would be to make a formal complaint to Santander and/or the dealer.

It seems clear you were under the impression that the agreement would be a PCP deal and not a fixed sum loan as per your documents. Just because it says fixed sum loan on the document does not mean to say it is.
I would print off a copy of that link I have given you and enclose it in the letter as it will form part of your evidence. The monthly payments are not fixed or equal as the final payment is over £5,000 whereas the rest are only £300+, this would indicate that it is more akin to a Hire Purchase/PCP agreement as you have the option to purchase the vehicle with a final balloon payment.

The reason I ask if you paid by credit card is that you could have had a join claim against your credit card provider and Santander/Mazda for misrepresentation and claim the full amount of the goods not the amount you paid through the Ombudsman rather than court.

Either way, you need to explain that there has been a clear misrepresentation, it is well known throughout the car finance business that a PCP is similar to a Hire Purchase in which the Guaranteed Future Value (GFV, or in your agreement the Guaranteed Price) is also known as the optional payment price which usually guarantees that the value of the vehicle will be at that price.

Despite your agreement saying that it is a fixed sum loan, on closer inspection, it is not and the contract is ambiguous on ownership of the vehicle too.

Slap it all in a letter, happy to check it over before you send it if you like

[Danmurray1]

Re: Voluntary termination refused

Here's what I wrote up below, if you could check it over that would be great, not sure if I worded it correctly.

Dear Sir/Madam

Following on from my previous letter from yourselves (see included) I would like to make a complaint as I believe I have been miss-sold a fixed sum loan however have documents I signed through the dealership are stating it was a 48 month PCP contract.

Also the contract documents do not represent a fixed term loan as the monthly payments are not fixed or equal as the final payment is £5,504,41 and the monthly payments are only £.334.39 Please see the attached documents from your website where you acknowledge a fixed sum loan is a fixed amount over a period of time.

I feel there has been a clear misrepresentation despite the agreement saying that this is a fixed sum loan, on closer inspection, it is not and the contract is ambiguous on ownership of the vehicle.

[R0b]

Re: Voluntary termination refused

Revised version, feel free to fill in gaps.

Dear Sir/Madam,

Re: Formal Complaint relating to Agreement Number XXXXXXX

Further to my previous letter, I am writing to you as I have concerns that I have been missold under an agreement entered into between Santander and myself. The deal was done through an intermediary at a Mazda dealership in [LOCATION] whom was acting on your behalf. It was agreed that the agreement for the vehicle would be entered into on a PCP basis for a period of 48 months and I attach the documentation that was given to me by the Mazda representative at the time. At no stage was I told that the PCP arrangement would be changed and in turn would amend certain rights which I may have under the Consumer Credit Act 1974, namely the right to terminate under section 99. When I attempted to terminate the agreement on [DATE], I was told that i could not because I had agreed a fixed sum loan and not a PCP agreement.

My concerns are as follows:

1. It was represented to me that the agreement would be based on a PCP agreement, not a fixed sum loan.

2. Upon review of the agreement I can see that there appears to be inconsistencies. For example, the monthly instalments provides for 48 payments of £334.49 followed by a single payment of £5,504.41 1 month after the date of the agreement. the repayment instalments are more akin to a PCP agreement and not a fixed sum loan. As pointed out on your website (copy attached) a fixed sum loan is a fixed amount for a fixed period with a fixed rate of interest. That is not consistent with the terms of the agreement as there is no fixed sum as I am required to pay £5,504.41.

3. The Agreement is also silent on ownership of the vehicle which again, should have been stated within the agreement [have you been told that they own the vehicle until payment? If so say this which again would indicate a PCP not fixed sum]

Given the circumstances above, it is my belief that there has been a clear misrepresentation insofar as that I was told that it was a PCP agreement, an untrue fact which I relied upon and induced me to enter into the agreement to my detriment. Furthermore, such actions taken by the Mazda representative and/or Santander amounts to both a misleading action and omission which is in breach of the Consumer Protection from Unfair Trading Regulations 2008. The Mazda representative gave no indication that the agreement had changed and he ought to have known that it did and therefore should have advised me of the differences. Had I become aware of the differences between the agreements, I would not have agreed to purchase the car.

To summarise, I would like to end the agreement in accordance with section 99 of the Consumer Credit Act on the basis of what had originally been agreed at the time. However should you refuse to do so, please provide me with a Final Decision Letter so that I make take my complaint to the Financial Ombudsman.

Regards,

[NAME]

[Danmurray1]

Re: Voluntary termination refused

That sounds much better! Thank you for all your help. I'm sending it off on a signed for next day service and will come back with the reply. Fingers crossed they accept it.

[GreenFly]

Hey,

I am in the same position with Creation and Arnold Clark.

How did you get on with the letter that you sent above?