Car finance - hidden commission payments
Discussion
OddCat said:
Where getting the discount was contingent upon taking the finance, did people think the dealer / manufacturer was, at their own expense, just being kind to Black Horse Finance ?
If someone offered you a £5000 discount on condition that you take finance and you know you can cancel the finance 14 days after you have signed up and you have the money to pay off the finance would you - A) Refuse the discount / Finance deal and pay £5000 more for the item
B) Take the discount and pay off the finance within 14 days
C) Take the discount and continue the finance deal to the end of it's term as you would be worried about the financial health of the dealership / finance company
djc206 said:
It’s not separate because the interest rate is being adjusted to claw back that incentive from the customer to pass on to the dealer as commission. In that example they’re giving with one hand and taking with the other.
If it is a new car, the discount is a manufacurer provided discount, the finance rate is provided by the finance company.If it is a finance deposit allowance, it will be paid if you use the finance. The rate will be decided by the finance company, so not adjustable. The finance commission payment would not make any difference to the charged rate, it has already been decided.
If it is a used car, the rate would impact the level of commision paid, but to provide a £5000 discount, and £2000 commission, you would need to have a very large balance and a very very large rate. The large APR on the loan, would put any buyer off.
sugerbear said:
If someone offered you a £5000 discount on condition that you take finance and you know you can cancel the finance 14 days after you have signed up and you have the money to pay off the finance would you -
A) Refuse the discount / Finance deal and pay £5000 more for the item
B) Take the discount and pay off the finance within 14 days
C) Take the discount and continue the finance deal to the end of it's term as you would be worried about the financial health of the dealership / finance company
If you paid the loan off within the 14 days, exercising the 'right to withdraw' clause. You would have to put the dealership back in the same position. So the finance provided deposit, would need to be paid by you. A) Refuse the discount / Finance deal and pay £5000 more for the item
B) Take the discount and pay off the finance within 14 days
C) Take the discount and continue the finance deal to the end of it's term as you would be worried about the financial health of the dealership / finance company
You would need to pay back after the 14 days to get the benefit.
Ford Credit, provide a finance deposit conttribution on selected cars. At present £1250 on a Focus. This can be on a 2 year ,0% PCP. So if you finance, it is £1250 cheaper. And after 14days, you can pay off. This is in addition to any discounts provided.
People still pay cash and pay the extra £1250.
sugerbear said:
OddCat said:
Where getting the discount was contingent upon taking the finance, did people think the dealer / manufacturer was, at their own expense, just being kind to Black Horse Finance ?
If someone offered you a £5000 discount on condition that you take finance and you know you can cancel the finance 14 days after you have signed up and you have the money to pay off the finance would you - A) Refuse the discount / Finance deal and pay £5000 more for the item
B) Take the discount and pay off the finance within 14 days
C) Take the discount and continue the finance deal to the end of it's term as you would be worried about the financial health of the dealership / finance company
Obviously, in reality, you'd be retarded not to choose option B (assuming this didn't mean you had to pay back the discount).
The people claiming did option D:
D) Take the discount, don't clear the finance, be lazy (and not even slightly savvy) by not even looking at cheaper options to clear the finance, and keep your fingers crossed that some technicality later on will result in some kind of refund.
Oddcats option D
D) Take the discount, don't clear the finance, be lazy (and not even slightly savvy) by not even looking at cheaper options to clear the finance, and keep your fingers crossed that some technicality later on will result in some kind of refund.
My option E.
Discount may or may not have been available but finance rate may have been acceptable , don’t clear the finance by being savvy ie letting your existing money work for you therefore offsetting said finance cost and in some cases completely so.
Appreciate that OC has no skin in the game and wants to believe what he wants to believe but irrespective, regulations are just that and at this stage no one knows if they have been overcharged due to hidden commission although the FCA seems to think 40% of buyers possibly were.
IF I get any money back ( and that’s a big IF ) I’ll put that into another car.
D) Take the discount, don't clear the finance, be lazy (and not even slightly savvy) by not even looking at cheaper options to clear the finance, and keep your fingers crossed that some technicality later on will result in some kind of refund.
My option E.
Discount may or may not have been available but finance rate may have been acceptable , don’t clear the finance by being savvy ie letting your existing money work for you therefore offsetting said finance cost and in some cases completely so.
Appreciate that OC has no skin in the game and wants to believe what he wants to believe but irrespective, regulations are just that and at this stage no one knows if they have been overcharged due to hidden commission although the FCA seems to think 40% of buyers possibly were.
IF I get any money back ( and that’s a big IF ) I’ll put that into another car.
alscar said:
sugerbear said:
When / if I get a payout I will be heading to an online travel agent for a couple of weeks of winter sunshine. Should be enough for Dubai.
This is exaclty what I had planned when I took out the car finance in 2015.
This is exaclty what I had planned when I took out the car finance in 2015.
PlywoodPascal said:
Reply from BMW finance, saying they cannot locate the agreements and asking for names (not changed), postcodes (included originally), DOB, size of monthly payments.
Wonder if its just a filter to try and fob people off.
VW/Audi have so far responded to 2 of my 3 enquiries. I don’t know which agreement they’re referring to but I’d guess it’s one of the earlier ones so either 2011 or 2012 that they’ve said might have been affected. The other they said wasn’t which I’d guess was the last agreement I had with them from 2014 on a new car sold via a campaign on a fixed % deal.Wonder if its just a filter to try and fob people off.
Worth pursuing.
VWFS just sent me 3 separate emails on 3 agreements saying no DCA ‘s in place.
They haven’t as yet responded on the 2 other ones I had ( technically PFS but now VW) which I think were the 2 “ oldest “.
Nothing at all as yet from BMW although still within their auto reply of 88 days to reply or whatever it was.
They haven’t as yet responded on the 2 other ones I had ( technically PFS but now VW) which I think were the 2 “ oldest “.
Nothing at all as yet from BMW although still within their auto reply of 88 days to reply or whatever it was.
Random_Person said:
There won't be much money per claim, think you will be lucky to go abroad. A second hand TV maybe. Looking like 400 - 600 per car.
My post was tongue in cheek and it does depend on the amount borrowed. I know that I borrowed quite a bit on PCP. Even a small uplift in interest of 3% on £20,000 / over 24 months would come to about £1200, but on top the finance company will need to add a flat rate of 8% per year which if the agreement was eight years old would be another £750 on top. I have no idea if a hidden payment was added in my case and I have no idea how much extra was added as they are still investigating but a figure of 1k to 2k wouldn't be out of range for an average family car in my opinion.
sugerbear said:
My post was tongue in cheek and it does depend on the amount borrowed. I know that I borrowed quite a bit on PCP. Even a small uplift in interest of 3% on £20,000 / over 24 months would come to about £1200, but on top the finance company will need to add a flat rate of 8% per year which if the agreement was eight years old would be another £750 on top.
I have no idea if a hidden payment was added in my case and I have no idea how much extra was added as they are still investigating but a figure of 1k to 2k wouldn't be out of range for an average family car in my opinion.
Isle of Wight maybe then ?I have no idea if a hidden payment was added in my case and I have no idea how much extra was added as they are still investigating but a figure of 1k to 2k wouldn't be out of range for an average family car in my opinion.
Gassing Station | Finance | Top of Page | What's New | My Stuff