Voluntary termination of PCP

[stepmeek]

Yes I know this has been asked a hundred times before, but give me a chance.

We bought the wife a car around 2 1/2 years ago, now I know I need to have paid half the amount owed on the car, I paid a decent deposit and I am now around a £1000 short of the "halfway point". So I called the finance company today to say I wished to make a payment of £1000 to my car and then terminate my contract early. But they have said this isn't possible.

Apparently my PCP contract is NOT secured against the car and I have no right to vomuntary termination.

Has anyone ever heard of this before? Is there a type of PCP out there where you aren't entitled to hand the car back after you have paid half the owed amount? I have had a search online and I am struggling to see anything related, and my contract is quite vague.

If anyone has any experience in car finance any advice would be appreciated, or send me a PM if possible.

[stepmeek]

steve-5snwi said:

Have you hpi'd the car to see if your agreement number is registered against the car ?

No, what would this involve? do all vehicle checks show this?

[stepmeek]

Butter Face said:

Sounds more like you have HP with a balloon rather than PCP. Who is the finance with?

If that's the case, we have been completely mis sold the car. Either that or whoever I spoke to on the phone is talking nonsense.

[stepmeek]

finance is with santander

[stepmeek]

Jobbo said:

HP would still be secured on the car. I VT'd an HP with balloon in 2004 without any problem.

The VT right will be set out in the finance agreement. What does that say?

I can't see a single mention of VT on it. The agreement is titled "PCP Advantage FDC", so it is PCP. The issue is if there is a type of PCP that states I am not entitled to VT after half owed amount is paid? And I can;t find anything to confimr this one way or another.

[stepmeek]

Mattt said:

Volvo by any chance?

Yes, it is a volvo. Why do you say that!?

[stepmeek]

Joey Deacon said:

Just out of interest why are you so desperate to get rid of the car that you are willing to pay £1000 to get shot?

If it isn't a PCP with VT, can you just pay off the outstanding finance and sell it?

Because I now have a company car, so I have a three cars sitting in the drive, one of which never gets used. I dont have 14k sitting in the bank to pay off the value of the car, I do have £1000 to VT it though

[stepmeek]

Butter Face said:

PM me the reg and I'll do a quick HPI for you.

Thank you, PM sent. Cancel that, E-mail sent via pistonheads, not sure how PM system works on here!

Edited by stepmeek on Thursday 19th January 10:57

[stepmeek]

Butter Face said:

Finance is with Santander, recorded against VRM/VIN but does show as Personal Loan. You don't get VT rights under personal loan terms.

Time to dig out your agreement, selling dealer should have made it clear that it is a personal loan NOT hire purchase!

Oh for f*** sake. Totally misleading then as even the paperwork has PCP headers all over it. We were lead to believe it was a PCP when we bought the car. I didn't know personal loan could be had with a car and a balloon payment at the end was even possible, is this quite common?

[stepmeek]

essayer said:

Is it one of these
https://www.santanderconsumer.co.uk/finance-that-f...

Yes, looking at that, it seems exactly what it is. Note right at the top of the page it says:
"A Fixed Sum Loan with Guaranteed Final Payment is not available as a standard product choice. We may offer you this product as part of our underwriting conditions. Your dealer will make you aware of this after your application for finance has been received and assessed by us."

So my wife has applied for PCP, not got it for whatever reason (I find it hard to believe she failed a credit check as she has a mortage in her own name), and we have then been refereed to a loan deal. At no point were we told about this change.

Who should I contact in the first place to complain about this. Volvo, Santander or the car dealership?

[stepmeek]

Butter Face said:

Not overly common. Done a few with Santander over the years. Not a fan of doing PL stuff at all really, makes more sense for the customer to get their own finance from the bank!

But this does look like PL with a Balloon rather than PCP. Would need to see the finance docs to confirm.

Thanks for the help. Would you mind if i sent you a PM with a picture of the document. The issue I am having with it is that we have an explanation document for a "fixed sum loan" with a customer copy agreement stapled to the back that looks to me as if it is for PCP.

[stepmeek]

essayer said:

Is it worth getting a loan to pay off the finance then sell privately/WBAC etc?

Yeah it may be. My main concern right now is speaking to the salesman in question. Very interested to see what paperwork they have at the dealership signed from my wife as I had absolutely no idea we weren't taking out a PCP

[stepmeek]

Mattt said:

I guessed Volvo as my OH had exactly the same thing, and it wasn't explained what the implications were.

She had good credit scores too, so doubt she'd fail a credit check.

It's really poor. My fault for not going through the paperwork more thoroughly and questioning it. However the way it is worded with final payment and mileage charges etc it looks to be a PCP

[stepmeek]

HTP99 said:

I seem to re-call; this was a while ago now, 10 or so years, Fiat started to use personal loans as opposed to HP or PCP on their cars as too many were being VT'd halfway through the agreements, costing Fiat rather a lot.

yeah it's probably what they have done, if they aren'e making people aware at the point of sale though then that is not right.

[stepmeek]

Butter Face said:

Yeah of course, send it along.

Thank you, PM sent

[stepmeek]

esxste said:

Wow looking at that link... no wonder you got confused, the way it is designed makes you think its a classic PCP.

Yeah I am unimpressed by it. Waiting on someone from santander finance contacting me but I don't imagine I am going to get far as the terms and conditions are there in the documentation. I do think they have missold it as PCP at the dealership though as there was no mnetion of a loan.

[stepmeek]

stelex15 said:

I also have a Volvo on what I thought was a PCP and was looking into how to get out of it. Having checked my credit report, the finance from Santander is listed as Balloon HP rather than PCP.

Looking through my documents, the amount of the loan includes the final payment to purchase the car. Should this be the case with a PCP? Or should the loan just be the amount that is required to take you up to that final payment? It makes a difference in my case because with the final payment sum included I am a few months off being halfway through to voluntary terminate. If I was loaned the amount to get me to the final payment, I would be halfway through now.

Hope the above makes sense!

Not sure I understand what you mean to be honest. My plan now looks like it is a hire purchase but with a final balloon payment at then end of the loan if I want to keep the car. I don't really understand it fully myself as I cant really seperate it from a standard PCP at the minute, I am waiting on someone from santander managament calling me tomorrow as the adviser today couldn't explain it properly. I will keep you updated and PM you if you like.

[stepmeek]

djc206 said:

Would selling to WBAC require you to do that? I've sold a couple of cars with outstanding finance on and the buyer just cleared the outstanding and paid me the difference. Given that most cars are financed these days I seriously doubt WBAC would make anyone jump through that unnecessary hoop. It might give peace of mind in a private sale but again can easily be avoided. Curious as I'm about to sell my car which is on a PCP with a decent amount of equity.

OP sounds to me like you were missold a financial product, that's a serious fking no no. Having been through a dispute with a mortgage advisor I can't recommend the financial ombudsman enough. A very quick and fair judgement.

To be honest I am not keen on selling the car, part of the reason for taking PCP ws that I could hand the car back when we had paid our half owed amount. I am reluctant to let them off the hook by selling the car myself. But it is an option.

Yeah it is starting to look like I was, as the link posted by a poster further up the page showed this option should only be used when PCP is not suitable and I should have been informed, which I wasn't, really not happy about it. I am waiting for a response from Santander tomorrow and then I will be contacting Volvo UK and taking it from there.

[stepmeek]

Lurking Lawyer said:

Don't be fobbed off by them. If need be, make a formal complaint and tell them that you want a final decision letter so you can make a complaint to the Financial Ombudsman Service.

Santander will be on the back foot a bit as they have absolutely no way of knowing or being able to establish how the salesman sold it to you but are potentially still on the hook for his actions and representations nevertheless.

Thanks for the advice. I am waiting to hear from them, I want to know why I was given this rather than standard PCP and what the criteria is, which they couldn't answer so we shall see tomorrow.

[stepmeek]

djc206 said:

Good luck. Make sure you keep a record of all communications, it made dealing with the ombudsman a breeze when we used them to resolve our dispute.

Thanks, yeah I will do, good advice.