Are the wheels about to fall of car finance?
Discussion
djc206 said:
Sheepshanks said:
I Withdrew from my deal. It's very common. Key practical difference is there's no interest penalty.
Not necessarily true. I have posted the section from my agreement (last page) there is a £4.50/day interest penalty on mine in the event of withdrawal. Mine also stipulates that any deposit contribution would need to be repaid in full so in my case I'd have to be mad to withdraw from the agreement when I could instead just phone up and 'settle' it in full (not that I have any intention).silentbrown said:
Thanks for posting that image (even rotated!). I'm not surprised those clauses are being put in but that's the first I've seen in the flesh.
Indeed it most definitely wasn't a clause in any previous agreement I've had (all with VWFS). This is a Ford agreement for reference in case anyone else has one or is entering one and planning on withdrawing.djc206 said:
daemon said:
Personally, i'm not arguing, i'm stating how it is
Theres an important difference between cancelling within the cooling off period and settling the finance via withdrawal from the agreement.
Its worth noting the difference, as it may be significant to someone planning on doing so, and who is reading this thread.
Indeed but the use of withdrawing, settling and cancelling is all getting rather confused. Theres an important difference between cancelling within the cooling off period and settling the finance via withdrawal from the agreement.
Its worth noting the difference, as it may be significant to someone planning on doing so, and who is reading this thread.
To my mind everyone here who has wanted out of a finance agreement has phoned up the finance house for a settlement figure and paid the balance. They have settled their finance, they haven't cancelled anything, they haven't withdrawn from anything they've just paid the debt off as you would any other credit account. Of course withdrawal is an option but I don't see anyone here's description of what they've done as a withdrawal.
So anyone any thoughts on where we'll be in a years time or 3 years time?
Does anyone think it will really get any worse than say, tighter constraints on loans?
Anyone predicting a full market crash / tens of thousands of cars being repossessed / handed back, nearly new car values in the doldrums?
Does anyone think it will really get any worse than say, tighter constraints on loans?
Anyone predicting a full market crash / tens of thousands of cars being repossessed / handed back, nearly new car values in the doldrums?
djc206 said:
Sheepshanks said:
I Withdrew from my deal. It's very common. Key practical difference is there's no interest penalty.
Not necessarily true. I have posted the section from my agreement (last page) there is a £4.50/day interest penalty on mine in the event of withdrawal. Mine also stipulates that any deposit contribution would need to be repaid in full so in my case I'd have to be mad to withdraw from the agreement when I could instead just phone up and 'settle' it in full (not that I have any intention).The penalty on Settling is governed by the Consumer Credit Act and it's 30 days. In addition you generally have to give 28 days notice so effectively you're paying 2 months interest to Settle.
The deposit contribution clause is interesting / scary though! I've never seen that before and it's certainly standard practice on the two marques I follow, VW and Mercedes, to Withdraw and keep the contribution, and they're both companies who wouldn't be doing that if they didn't have to. I guessed (but don't know for sure) it's to do with it being illegal to charge different prices for cash and credit.
djc206 said:
Indeed it most definitely wasn't a clause in any previous agreement I've had (all with VWFS). This is a Ford agreement for reference in case anyone else has one or is entering one and planning on withdrawing.
Certainly VWFS just give a full and final figure when Withdrawing. If it turns out that in future they add the Deposit Contribution back in then people would just have to default to Settling and take the interest hit. Typically a couple of hundred quid, as you suggested earlier - relatively small compared to multiple £K's contributions on offer.trowelhead said:
Ares said:
Yes. Unless you have a clever accountant/pool car/cough
ooooo... please tell me more... HMRC may or may not test that the criteria are met. I certainly wouldn't chance it.
Edited by nickfrog on Wednesday 9th August 08:47
daemon said:
Ares said:
djc206 said:
Ares said:
Unless early settlement has punitive penalties! Settlement figures in year one often have full term interest within.
You're entitled to withdraw from any financial product within the first 14 days without penalty are you not?....Although, as the car was then used, it would be worth even less, so buy it back and double save?
To settle finance, they would throw in admin charges and/or other costs. I've heard of interest being 100% front loaded, so the first £X,000 you may is all interest, hence why settlement figures in the first few months are often the full cost of the car.
If you SETTLE within the first month (or any time for that matter) they are legally obliged to only charge you a fair interest amount. They CANT charge you a years interest or the full interest. Typically that amounts to a few pounds / few hundred pounds at most.
And for the avoidance of doubt, you dont CANCEL the agreement - that would roll back the finance agreement and make the full amount payable to the dealer.
And i know thats how it works as (a) i used to work for Santander bank, (b) i used to sell cars for a living and (c) i've done it!!
Again, very surprised that some of the people who tell us they do this regularly havent by now jumped in to explain - gee, maybe that tells us something.....
Ares said:
daemon said:
Ares said:
djc206 said:
Ares said:
Unless early settlement has punitive penalties! Settlement figures in year one often have full term interest within.
You're entitled to withdraw from any financial product within the first 14 days without penalty are you not?....Although, as the car was then used, it would be worth even less, so buy it back and double save?
To settle finance, they would throw in admin charges and/or other costs. I've heard of interest being 100% front loaded, so the first £X,000 you may is all interest, hence why settlement figures in the first few months are often the full cost of the car.
If you SETTLE within the first month (or any time for that matter) they are legally obliged to only charge you a fair interest amount. They CANT charge you a years interest or the full interest. Typically that amounts to a few pounds / few hundred pounds at most.
And for the avoidance of doubt, you dont CANCEL the agreement - that would roll back the finance agreement and make the full amount payable to the dealer.
And i know thats how it works as (a) i used to work for Santander bank, (b) i used to sell cars for a living and (c) i've done it!!
Again, very surprised that some of the people who tell us they do this regularly havent by now jumped in to explain - gee, maybe that tells us something.....
RSK21 said:
DonkeyApple said:
But your need to fragrantly try and re-write history and to repeatedly ignore facts and to make wild statements with no supporting evidence almost smacks of a guy trying to live with the guilt of conning hundreds of people into unsuitable debt deals so as to shift some cars and earn some dirty money?
Yikes. A former proponent of binary options lecturing on morality.There's a joke in here somewhere.
A bookmaker and a car salesman are standing before St Peter at the pearly gates .............
Edited by RSK21 on Tuesday 8th August 13:23
Edited by RSK21 on Tuesday 8th August 13:35
Are you retarded? I've probably been the single voice against them since they came into being. Fundamentally because I was there and didn't want them to launch back then.
So, please prove your statement.
DonkeyApple said:
A former proponent of binary options?
Are you retarded? I've probably been the single voice against them since they came into being. Fundamentally because I was there and didn't want them to launch back then.
So, please prove your statement.
I thought you used to work for IG ?Are you retarded? I've probably been the single voice against them since they came into being. Fundamentally because I was there and didn't want them to launch back then.
So, please prove your statement.
If it's a different bloke on record talking about IG's binary offerings many moons ago then please accept my apologies.
Still the bookie and car salesman scenario remains valid doesn't it ?
Edited by anonymous-user on Monday 21st August 21:26
Edited by anonymous-user on Monday 21st August 21:35
Of course they are. It may affect company buyers less, but as soon as interest rates creep up, and they will, those who have bought - sorry - signed up for half a car for three years, with unrealistic mileage restrictions will be in deep dudu
Edited by Lester H on Monday 21st August 23:13
Lester H said:
Of course they are. It may affect company buyers less, but as soon as interest rates creep up, and they will, those who have bought - sorry - signed up for half a car for three years, with unrealistic mileage restrictions will be in deep dudu
Why? The interest rate isn't variable on PCPs. They are in no deeper doodoo than before. They may not be able to afford another identical car on PCP so may end up buying secondhand, but that's no different from someone who has yet to take out a PCP...silentbrown said:
Lester H said:
Of course they are. It may affect company buyers less, but as soon as interest rates creep up, and they will, those who have bought - sorry - signed up for half a car for three years, with unrealistic mileage restrictions will be in deep dudu
Why? The interest rate isn't variable on PCPs. They are in no deeper doodoo than before. They may not be able to afford another identical car on PCP so may end up buying secondhand, but that's no different from someone who has yet to take out a PCP...Savers lose.
Given what happened to the pound, inflation has to increase, ergo taking out loans at fixed, lowish rates is sensible.
RSK21 said:
DonkeyApple said:
A former proponent of binary options?
Are you retarded? I've probably been the single voice against them since they came into being. Fundamentally because I was there and didn't want them to launch back then.
So, please prove your statement.
I thought you used to work for IG ?Are you retarded? I've probably been the single voice against them since they came into being. Fundamentally because I was there and didn't want them to launch back then.
So, please prove your statement.
If it's a different bloke on record talking about IG's binary offerings many moons ago then please accept my apologies.
Still the bookie and car salesman scenario remains valid doesn't it ?
And with regards to IG, there was an institutional arm which ran the clearing for funds and other brokers etc rather than the spread betting/ binary side.
And if you go back to the earliest mentions of binary betting on PH you'll find a Horse_Apple being as uncomplentary as dared at that time.
They are a pure bookmaker product and absolutely everyone who works with them knows full well they are specifically designed to rinse a client's account.
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