This legal right and law was introduced to protect you or any consumer who has difficulty paying the monthly payments for their car. It also gives the financial firm more protection to prevent borrowers from moving away from a contract without an obligation to pay. This is done by determining a total amount to be paid, which is usually halfway through the agreement or when you have paid 50% of the total amount due for the vehicle. The letters and invoices you receive upon voluntary termination may be enough to prevent you from following the process. The legal jargon they use is designed to scare you and make sure you pay, even if you only have minor damages and minor fees for excess mileage. I struck a deal with £13,250 in September 2014 to pay back £210 a month. The car was from my husband, and we have now separated, so I have to make the payments. I want VT, but since I haven`t paid back much, is it possible? Can Mercedes refuse to terminate the contract if I do not sign their termination agreement? As you can understand, a financial company will not be satisfied with this at all. But there`s not much they can do to stop someone from doing a voluntary termination because the law protects your consumer rights. This is usually the reason why car dealers do not inform you of the exit clause. Having this veil of confusion suits them better, so you can see the contract without thinking that there is a way to escape payments.
I recently sent Mercedes Finance a letter to terminate my hire-purchase agreement under the half-value rule. I received a letter asking me to sign a voluntary cancellation confirmation before they gave me an appointment for pickup. I am very hesitant to sign this, but they said I couldn`t end the agreement without signing the letter and sending it back. Any suggestions? This has led to many people`s experiences with voluntary dismissal being confusing and lengthy. This is because financial companies let customers run and prolong the process in the hope that the customer will give up. A voluntary surrender is really the bottom of the barrel and a scenario you don`t want to go through. The finance company will continue to sue you for the money even if you no longer have the car. With all the fuss surrounding the VW emissions scandal, voluntary termination was a hot topic for many owners. Many owners now see their car as a burden and want to move on. What many people don`t understand is their right to VT/voluntary termination of their vehicle financing contract without penalty. Hi Tom. The amount is 50% of the total amount to be paid.
This should be clearly stated in your PCP agreement. That is not one of the amounts you have proposed. The total amount to pay is everything you borrowed + interest + fees. Any consumer who enters into a hire purchase agreement (HP) or a personal purchase agreement (PCP) has the right to voluntarily terminate the contract at any time. You can only voluntarily terminate a personal contract financing contract (PCP). These types of agreements are very popular in the UK. They allow the financing of a car that may not be financially viable through a bank or a fixed loan. Hi Stuart, I have a PCP deal with Ford.
I only paid 11 payments from my 68-month contract. My billing number is £7183.09. I checked the car dealership and my car is worth around £6800. Can I sell the car and pay for the negative equity? TERMINATION: YOUR RIGHTS You have the right to terminate this Agreement. To do this, you must write to the person to whom you are making your refunds. You are then entitled to the return of the goods and half of the amount to be paid under the contract, i.e. [£x – the exact number of your contract]. If you have already paid at least this amount plus the overdue payments and have maintained the goods appropriately, you do not have to pay more. The reality here is that if you go through the right steps for voluntary termination, there is nothing a financial company can do to stop you. Want more good news? Voluntary termination also does not adversely affect your creditworthiness or solvency. As a rule, this happens only in the case of a voluntary handover of the vehicle.
If you decide that voluntary termination is the right option for you, you should consider that the financial company may no longer accept requests from you in the future. You can only make a voluntary termination if the vehicle is not unduly damaged when it is returned. Anything beyond general wear and tear is considered excessive damage. All HP contracts have the same terms that allow you to cancel the contract and return the vehicle. Your rights are set out in section 99 of the Consumer Credit Act 1974. You don`t have to sign the forms they send you once you start your voluntary termination. Financial companies will try to impose the paperwork on you by saying that it is mandatory, but it is not. Most of these documents are worded in such a way that you end up signing your rights. Leasing contracts (usually a form of contract leasing) are generally preferred by commercial customers. However, a number of financial companies are now promoting personal rentals for individuals.
This is due, among other things, to the absence of voluntary termination rights in a rental agreement. Hi, I have a question if you could please help with this, I am looking for VT my car contract but I am about £1500 below 50%, I should be able to increase this, but do I have to pay this first before sending the VT letter from the legalbeagels website and informing the financial company 14 days in advance, or can I send the letter and then pay the balance? A financial company will try to drag out the process so that you continue to make payments in the meantime, which means they will get more of their money back. .