Voluntary Termination of HP Agreement

[SaltnVinegar]

Hi All

I am looking to VT the Hire Purchase Agreement of a car we currently 'own'.

The car is on a 36 month agreement with the 18th payment being paid in October.

However this won't quite cover the 50% I need to just hand the car back as the final months payment of the agreement is a little bigger than the normal payments meaning that half the payments doesn't quite cover half the total balance (by about £20).

Am I correct in saying that if I sent a VT letter with a cheque to make up the 50% then this would be acceptable for me to terminate the agreement?

Thanks in advance

SnV

[CleverClogs (RIP)]

Re: Voluntary Termination of HP Agreement

Are the ash-trays full already?

[SaltnVinegar]

Re: Voluntary Termination of HP Agreement

Are the ash-trays full already?

Are you suggesting commiting arson and claiming the insurance money?!

[CleverClogs (RIP)]

Re: Voluntary Termination of HP Agreement

No - just that it seems a bit early to end the HP agreement.

[SaltnVinegar]

Re: Voluntary Termination of HP Agreement

No - just that it seems a bit early to end the HP agreement.

Not really - the cars been a bag of brown sticky stuff, isn't reliable and isn't worth 50% of whats remaining on the finance either due to depreciation.

Financially it makes sense to just hand it back as the money saved on the finance payments would be better used elsewhere!

SnV

[CleverClogs (RIP)]

Re: Voluntary Termination of HP Agreement

Not really - the cars been a bag of brown sticky stuff, isn't reliable and isn't worth 50% of whats remaining on the finance either due to depreciation.

If the jalopy isn't reliable, why not use section 75 (link) of the Consumer Credit Act 1974?

[garlok]

Re: Voluntary Termination of HP Agreement

Hi SnV,

I don't think its current value would come into it much as most vehicles have depreciated 30 to 40% as you drive them off the forecourt. Just how unreliable has it been? Goods must be fit for purpose under the Sale of Goods Act and major mechanical failure during the period of warranty has in the past rendered vehicles unfit for purpose under this bit legislation. Might be worth a call to trading Standards localy but I don't have a lot of faith in them.

regards
Garlok

[SaltnVinegar]

Re: Voluntary Termination of HP Agreement

Hi All

Thanks for the replies. Heres the whole sorry saga so get a cuppa on before you start to read as its pretty lengthy!

Unfortunately the car wasn't under any manufacturers warranty as it was 5 years old when I bought it. There was no dealers warranty either.

We have had a multitude of problems with it. After several months of unreliability with the car not running properly, many fault codes, car constantly going into limp home mode etc we asked a local garage we trust to inspect the car.

We cannot prove this but the problems seem to stem from the fact that before we bought it the engine had been repaired (suspect cambelt failure) but had not been repaired properly.

We have discovered this as our garage have found a multitude of things such as silicone sealant being used in incorrect places causing vacuum issues, bolts not set to correct torques, incorrect tolerances (injector gaps), broken rockers/valves still in the engine...... basically a bodge job.

I went back to the garage where I bought the car and was basically told to arkell v pressdram.

I contacted the finance company and quoted sales of goods act. I was told that as 6 months had passed since the car was purchased their obligations under the sales of goods act had ended. They offered as a 'goodwill' gesture to pay around £500 towards a settlement figure if I took out finance towards another car.

This really wasn't an option for me, as with what the car was worth at the time I couldn't have afforded the settlement figure nor did I want to take out further finance.

We go the car repaired by our local garage and it has been running for the last 6 months with no 'major' problems. I say no 'major' problems because there have still been a multitude of 'minor' problems. The car still frequently goes into limp home mode for no discernable reason despite our garage investigations (who have been great and don't charge us for plugging the car into their diagnostic set. Local dealer/stealer charge £60 a pop for this!!), we have had tyre pressure sensors fail, the car seems to chew through a set of tyres every 6,000 miles.

Last week the car again went 'bang' leaving us with another huge bill. Simply, as we just cannot trust it any more, nor do we want to chuck even more good hard earned money after bad, we thought they easiest (and perhaps cheapest in the long run) thing to do would be to voluntary terminate the HP.

However that was 24 hours ago and a lot can happen in a day!

Now onto something more interesting:

When I bought the car I did do a HPI check which showed that the car had no outstanding finance and verified the mileage, accident damage etc and it came back all clear. The car also had a service history with a main dealer who the dealer I bought the car from said they got it from as it was a p/x.

What I didn't know at the time was that you can also check the MOT history with VOSA.

I was told about this last night so out of curiosity this morning I have checked the MOT history on the VOSA website and have noticed that the mileage recorded on the MOT history DOES NOT match the mileage shown in the service history book as the services stamps MONTHS after the MOT's are showing much lower mileages!

This would suggest that the car was not serviced (or the service book was lost) so either the main dealer has falsified a service history, or the dealer I bought the car from has managed to get a stamp for the main dealer and have falsified the service history themselves.

I'm wondering if this completely changes the landscape as surely this is a little more serious now than a Sales of Goods Act arguement?

Thanks for reading!

SnV

[CleverClogs (RIP)]

Re: Voluntary Termination of HP Agreement

How does the current mileage shewn on the odometer compare with the mileage at the last service you have discovered? If the current mileage is less, then one can be certain of deception.

[SaltnVinegar]

Re: Voluntary Termination of HP Agreement

Ok decision made..............

I am going to VT the HP agreement with the finance company. Letter is going to go to them as soon as they get the next HP payment which will take the amount to 50% of the finance.

I'll then argue the toss on condition, if, should, it happen to raise its ugly head.

Will keep you updated!

SnV

[fiscalfool]

Re: Voluntary Termination of HP Agreement

When I exercised my right to Voluntary Termination, I did it via the telephone. I've done it several times. They ALWAYS try to fob you off, by saying "If you VT, then it MAY affect your credit rating".

What's actually the trust is: You are perfectly entitled to Voluntary terminate, after half of the initial amount has been paid off. So long as the initial price of the vehicle was £25k or less, AND you have VT clause in your contract.

The problem is that the finance companies hate it, as it loses them millions each year ... which is why they try to force you down the personal finance route instead.

The only issue that I had was that the wear and tear of the car, should be in-line with the condition of the vehicle. So, one of my vehicles had a ding in the rear wing, which they quoted a price to fix it ... I laughed and gave them the insurance details of my neighbour whom had hit my car. That was the last I heard of it.

Generally it's fairly straight forward process, they take the car ... or usually ask you to take it to a local auction house .. it sells and then it's over with.

[SaltnVinegar]

Re: Voluntary Termination of HP Agreement

When I exercised my right to Voluntary Termination, I did it via the telephone. I've done it several times. They ALWAYS try to fob you off, by saying "If you VT, then it MAY affect your credit rating"

I'd love to have that conversation! My credit rating is about as shot to bits as it could be so there would be nothing that they could add to it to make it worse!

You are perfectly entitled to Voluntary terminate, after half of the initial amount has been paid off. So long as the initial price of the vehicle was £25k or less, AND you have VT clause in your contract

Well that was my original question. Next month I will have made half the payments but not half of the total cost due to an 'admin' fee that has been applied. We're talking about £25 here so I was wondering when I send the VT letter to the finance company if I can include a cheque to make up to the 50%?

The problem is that the finance companies hate it, as it loses them millions each year ... which is why they try to force you down the personal finance route instead

TBH I have lost thousands on a car that has been the worst most unreliable heap I have ever had the displeasure of owning! Can't say I feel sorry for the finance company handing it back!

The only issue that I had was that the wear and tear of the car, should be in-line with the condition of the vehicle. So, one of my vehicles had a ding in the rear wing, which they quoted a price to fix it ... I laughed and gave them the insurance details of my neighbour whom had hit my car. That was the last I heard of it.

This is the other question I have. If they do start playing those sorts of games, I am wondering due to the amount spent in repairs plus the dodgy service history that I can push back with SOGA.

Generally it's fairly straight forward process, they take the car ... or usually ask you to take it to a local auction house .. it sells and then it's over with.

I'm hoping thats going to be the case!

Thanks

SnV

[SaltnVinegar]

Re: Voluntary Termination of HP Agreement

Hi All

As promised heres an update on this situation:

VT letter was sent off the to the finance company with cheque to make up the 50% figure.

Finance company have accepted the VT but want an 'independent' inspection of the vehicles condition. There is a big list of what they expect to be 'reasonable' condition one of which is a full service history for the car.

Now considering we have paid over £4k in repairs on this car, not to mention the fact that I have discovered the service history that came with the car has been falsified this is going to be interesting!

They are obviously trying to pave the way for setting me up on this.

Need to arrange the inspection date/time next so will let you know what happens.

Best

SnV

[SaltnVinegar]

Re: Voluntary Termination of HP Agreement

Well called up the finance company to arrange inspection and collection.........

They started to talk about the 'reasonable condition' thing and the sorts of things they would be looking for on the car so interrupted them at this point.

Mentioned that numerous problems with the car and the fact that I have discovered that the service history has been falsified (with proof from VOSA MOT website).

To be fair to them the person I spoke to immediately agreed that was not acceptable and have cancelled the inspection and they will now just collect the car and take it straight to auction and that will be the end of it.

So fingers crossed this massive pita which has been financially hamstringing me will soon be gone!

Best
SnV

[BBoo]

Re: Voluntary Termination of HP Agreement

I'm pleased for you - the condition inspection can prove a bit of a nightmare, so if you've managed to avoid that, it's a major plus!

I have to say, I never spend more than about £5-600 on a car nowadays, and while I always spend a bit of money doing everything that's needed ( fortunately I can do it myself) - one has never let me down in years now.