Leasing query - PCH & Fleet Pricing
Discussion
Have recently FTK'd on a XC60 T8 PCH lease deal through a broker after a lot of researching. Yesterday I paid the processing fee and completed the car order forms.
Today I was contacted asking for me to provide proof from my employer that I have a personal car allowance as Volvo wouldn't accept the order without it. I went back to them telling them I didn't (we only get mileage allowance) but asking why does that make a difference. I ended up speaking to them on the phone and turns out the special deal is for fleet pricing and so Volvo are asking for proof of the car allowance as that can mean eligibility for fleet prices.
Anyone had this before? I have sent them confirmation that I get mileage allowance as they said that might work but I am somewhat worried with the approach. Is there anything that can come back to me on this if it does go ahead? Currently waiting to see if they accept the order.
Today I was contacted asking for me to provide proof from my employer that I have a personal car allowance as Volvo wouldn't accept the order without it. I went back to them telling them I didn't (we only get mileage allowance) but asking why does that make a difference. I ended up speaking to them on the phone and turns out the special deal is for fleet pricing and so Volvo are asking for proof of the car allowance as that can mean eligibility for fleet prices.
Anyone had this before? I have sent them confirmation that I get mileage allowance as they said that might work but I am somewhat worried with the approach. Is there anything that can come back to me on this if it does go ahead? Currently waiting to see if they accept the order.
Two possible reasons for this:
1) In order to get to the quoted payment the leasing company needs to use a discount from the manufacturer which is only available to Registered Fleet Operators. The terms and conditons of this are entirely at the manufacturer's discretion and often allow the discount to be applied to cars bought or leased for the firm, or bought or leased by an employee in receipt of a car allowance.
The registration will be a formality and the leasing company will simply Register your company as a Fleet Operator and they can apply the discount. It won't obligate your company in any way, they will probably never know. Nothing to be concerned about here.
2) Cars bought / leased for business purposes fall outside the Consumer Credit Act. Having obtained evidence that the car is funded by an employer's car allowance, some finance companies use this as justification for offering you an Unregulated agreement. Be wary of signing an Unregulated agreement as a private individual as your rights if you wish to reject the car or if you wish to terminate the agreement early will be affected. Something to be concerned about here.....
ETA: Provided it doesn't compromise your position at work, just get a director to sign and submit a letter to the effect that you do get a car allowance. It appears to be qualifying you for the discount rather than forming part of your credit application.
1) In order to get to the quoted payment the leasing company needs to use a discount from the manufacturer which is only available to Registered Fleet Operators. The terms and conditons of this are entirely at the manufacturer's discretion and often allow the discount to be applied to cars bought or leased for the firm, or bought or leased by an employee in receipt of a car allowance.
The registration will be a formality and the leasing company will simply Register your company as a Fleet Operator and they can apply the discount. It won't obligate your company in any way, they will probably never know. Nothing to be concerned about here.
2) Cars bought / leased for business purposes fall outside the Consumer Credit Act. Having obtained evidence that the car is funded by an employer's car allowance, some finance companies use this as justification for offering you an Unregulated agreement. Be wary of signing an Unregulated agreement as a private individual as your rights if you wish to reject the car or if you wish to terminate the agreement early will be affected. Something to be concerned about here.....
ETA: Provided it doesn't compromise your position at work, just get a director to sign and submit a letter to the effect that you do get a car allowance. It appears to be qualifying you for the discount rather than forming part of your credit application.
Edited by Wooda80 on Friday 30th November 19:30
I posted in a similar situation a few weeks ago.
I had applied for a personal contract hire (lease) for a Mini Clubman, on the basis that this was a cost effective offer. There was no mention of business use, until my broker asked me to prove this. I provided a pay slip with business miles, but this was declined by Alphabet / BMW finance.
Fortunately, I was able to gain a letter from a Board member to the effect that I am a regular business user. This did the trick and the order is now placed.
Seems a little underhand to me, although it was such a good price that the extra effort was worth it. I calculated an assumed saving of £4k compared to a broker-sourced (cheapest) PCP, which in turn was also slightly cheaper than buying a 1-2 year old used model (my usual first port of call).
I had applied for a personal contract hire (lease) for a Mini Clubman, on the basis that this was a cost effective offer. There was no mention of business use, until my broker asked me to prove this. I provided a pay slip with business miles, but this was declined by Alphabet / BMW finance.
Fortunately, I was able to gain a letter from a Board member to the effect that I am a regular business user. This did the trick and the order is now placed.
Seems a little underhand to me, although it was such a good price that the extra effort was worth it. I calculated an assumed saving of £4k compared to a broker-sourced (cheapest) PCP, which in turn was also slightly cheaper than buying a 1-2 year old used model (my usual first port of call).
Thanks both for your input.
I suppose that fact of whether I get the discount as noted is not the issue, just that the finance agreement needs to be 100% correct and regulated.
It also appears that "mileage allowance" can be used under the term "car allowance" as long you can prove you are doing business miles and claiming on it, which I am and can, so have confirmed that to the lease broker.
Wish they had been more upfront about it in the dealings but hopefully they will accept the order. Will let you know.
I suppose that fact of whether I get the discount as noted is not the issue, just that the finance agreement needs to be 100% correct and regulated.
It also appears that "mileage allowance" can be used under the term "car allowance" as long you can prove you are doing business miles and claiming on it, which I am and can, so have confirmed that to the lease broker.
Wish they had been more upfront about it in the dealings but hopefully they will accept the order. Will let you know.
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