Cancelling HP/PCP in 14 Days Query

[DiamondLights]

Hi all, may be a silly question here but...

If I take out PCP/HP, lets say the car value is £40k but with PCP/HP over 4 years I pay back £50k in total.

If I decide to cancel the PCP/HP entirely in the first 14 days (during the cooling off period), what would I owe to pay off the car, the £40k? Or will I be asked to pay back the £50k inclusive of interest despite not incurring those charges?

(Above assumption there is no early penalty charge)

[Nickp82]

£40k only.

[anonymous-user]

You just pay back the £40K...who is it with ? If you go over the 14 day period expect to pay daily Interest, some dealers will stick a 6 month clause in that if you settle within six months (but outside of 14 days ) you pay a penalty. BMW don't but Skoda do.

Some dealers will actively avoid delivering your car within the 14 day cooling off period so they can claim the 6 month penalty if you pay it off after delivery.

[DiamondLights]

so if i can get a decent price on a HP Plan, get them to lower car value that way, then cancel within the 14 days and settle in cash, i should be fine to do that right?

[Sheepshanks]

doog442 said:

You just pay back the £40K...who is it with ? If you go over the 14 day period expect to pay daily Interest,

I've done this.

Within 14 days you're Withdrawing. You pay a daily interest charge until you tell them you want to Withdraw, then it's frozen and you generally have 28 days to pay.

After 14 days you're settling. The terms are governed by law - max a month notice and a month penalty so worst case (and it always seems to be this) you pay 2 month interest.

The grey area with Withdrawing is it's treated like the agreement never existed so in theory any benefits that you got could be reclaimed. But they never seem to be - we got £2750 deposit contribution from VW and there was never any suggestion they would ask for it back, and they didn't.

doog442 said:

some dealers will stick a 6 month clause in that if you settle within six months (but outside of 14 days ) you pay a penalty. BMW don't but Skoda do.

Some dealers will actively avoid delivering your car within the 14 day cooling off period so they can claim the 6 month penalty if you pay it off after delivery.

Skoda would be VWFS as was our VW. They don't have that term and I've never heard of it before. Once you're beyond 14 days and Settling, it's governed by the law.

You don't normally sign the docs until a couple of days before you pick up the car. I did wonder if that reduced the cooling off period and I was told (but unconfirmed) that it's treated as starting on the day you pick up the car as that's the date the agreement comes into force. It wasn't an issue in my case, but something to watch out for.