Car finance - hidden commission payments
Discussion
pavarotti1980 said:
OddCat said:
Do you know by how much Sainsbury's inflate the price of a tin of beans they obtained from Heinz ? Are you upset that they don't disclose this ?
I don't care because Doris on the checkout isn't changing the price and pocketing the difference. Slight difference between a profit margin and a sliding scale of commission depending on how greedy sales person feels
OddCat said:
Regardless, you wouldn't be stupid enough to pay more for the beans than you were happy to.
Mate I would give up with your utterly ridiculous attempt at comparisons. If this wasn't an issue then it wouldn't now be banned and it has been repeatedly pointed out to you god knows how many times. It's like trying to communicate with a turnip
OddCat said:
pavarotti1980 said:
OddCat said:
Do you know by how much Sainsbury's inflate the price of a tin of beans they obtained from Heinz ? Are you upset that they don't disclose this ?
I don't care because Doris on the checkout isn't changing the price and pocketing the difference. Slight difference between a profit margin and a sliding scale of commission depending on how greedy sales person feels
Would you think it legitimate for a salesperson to be charging disabled people more because they could? Or for cold callers to over price vulnerable pensioners for double glazing, driveway tarmacing or solar panels? That's the sort of point you need to be starting at and working back from and obviously when you do one quickly reaches the conclusion that it is not ever acceptable for any consumer saving salesman to be altering costs because of what they think they can get away with.
The trouble is that the car industry successfully lobbied the regulator for 20 years to be allowed to remain out of step with the rest of the consumer debt industry (just look around at how all other consumer debt has changed, the penalties for failing to do so and the new products that have sprung up to try and fill the gaps) but the tide looks to be turning.
The only true solution is for car vendors to be banned from arranging finance. Even the current fixed interest for all is fundamentally wrong as one group is subsidising the risk and cost of another. Debt is only ever equitable or legitimate when it is priced to the individual using only the risk they present.
And ask yourself this, why are people paying 12% on secured loans where the asset has to be insured? And not just why but how are dealers getting deals done when levying such enormous charges? That's an interesting side topic.
OddCat said:
...which brings us back to the question 'how much was reasonable'.
Perhaps the FCA will say 'all amounts over 200 basis points must be refunded'. They'll have to really because if they say 'firms who charged a flat 2% for all clients' is okay (regardless of non explicit disclosure) they can hardly then say to a firm that charged 2% for some and 3% for others 'you've got to give it all back'
There are claimants out there who think they are getting it all back which is clearly ridiculous. It is only 'excessive' amounts that should be refunded.
I don't think I have seen anything that suggests anyone actually thinks that they will get it all back - can you post a link in case I have missed it though ?Perhaps the FCA will say 'all amounts over 200 basis points must be refunded'. They'll have to really because if they say 'firms who charged a flat 2% for all clients' is okay (regardless of non explicit disclosure) they can hardly then say to a firm that charged 2% for some and 3% for others 'you've got to give it all back'
There are claimants out there who think they are getting it all back which is clearly ridiculous. It is only 'excessive' amounts that should be refunded.
If the FCA finds Lenders guilty then agree its the excessive only amount of interest but isn't it more likely of a flat penalty plus the ubiquitous 8% interest ?
Probably not on topic but I am buying a car at the moment and have been through the TCF process. Treating Customers Fairly.
Most of it was to try and see me extra insurance or protections like an extended warranty on a brand new car or alloy and tyre insurance. The only key difference I can see from the last time I bought a car a few years back is that now there are a series of questions that qualify you for the product instead or them just adding it to the bill because they can.
But can someone explain how selling those added products is in any way related to the Treating Customers Fairly guidance from the FCA?
Most of it was to try and see me extra insurance or protections like an extended warranty on a brand new car or alloy and tyre insurance. The only key difference I can see from the last time I bought a car a few years back is that now there are a series of questions that qualify you for the product instead or them just adding it to the bill because they can.
But can someone explain how selling those added products is in any way related to the Treating Customers Fairly guidance from the FCA?
alscar said:
I don't think I have seen anything that suggests anyone actually thinks that they will get it all back - can you post a link in case I have missed it though ?
If the FCA finds Lenders guilty then agree its the excessive only amount of interest but isn't it more likely of a flat penalty plus the ubiquitous 8% interest ?
I think that's right. If anything is done then the greatest offenders will just fold so the way these things tend to work is a relatively fixed sum across the board. Plus, I doubt there are many who at no point varied their finance to close a car sale. If the FCA finds Lenders guilty then agree its the excessive only amount of interest but isn't it more likely of a flat penalty plus the ubiquitous 8% interest ?
It's also more likely that such costs will fall onto the lenders anyway for their failure to hold their agents to account.
ashleyman said:
Probably not on topic but I am buying a car at the moment and have been through the TCF process. Treating Customers Fairly.
Most of it was to try and see me extra insurance or protections like an extended warranty on a brand new car or alloy and tyre insurance. The only key difference I can see from the last time I bought a car a few years back is that now there are a series of questions that qualify you for the product instead or them just adding it to the bill because they can.
But can someone explain how selling those added products is in any way related to the Treating Customers Fairly guidance from the FCA?
The TCF compliance in this regard is about ensuring everyone is offered the same and everyone has them equally explained. But ultimately, it's about the vendor being in a clear position to argue later that they did so, that all clients knew and that all clients made their own decisions. Most of it was to try and see me extra insurance or protections like an extended warranty on a brand new car or alloy and tyre insurance. The only key difference I can see from the last time I bought a car a few years back is that now there are a series of questions that qualify you for the product instead or them just adding it to the bill because they can.
But can someone explain how selling those added products is in any way related to the Treating Customers Fairly guidance from the FCA?
As seen with GAP insurance this hasn't previously been the case as the financial reward for the sale incentivised the product to be sold even when it wasn't necessarily wanted or needed and all too often with a heft mark-up being applied to the initial risk weighted cost that was then used to directly incentivise sales. Ie the price was multiplied and then sold using fear, so a perfectly good and useful financial tool became an overt profit centre that was actively pushed for personal gain.
alscar said:
OddCat said:
...which brings us back to the question 'how much was reasonable'.
Perhaps the FCA will say 'all amounts over 200 basis points must be refunded'. They'll have to really because if they say 'firms who charged a flat 2% for all clients' is okay (regardless of non explicit disclosure) they can hardly then say to a firm that charged 2% for some and 3% for others 'you've got to give it all back'
There are claimants out there who think they are getting it all back which is clearly ridiculous. It is only 'excessive' amounts that should be refunded.
I don't think I have seen anything that suggests anyone actually thinks that they will get it all back - can you post a link in case I have missed it though ?Perhaps the FCA will say 'all amounts over 200 basis points must be refunded'. They'll have to really because if they say 'firms who charged a flat 2% for all clients' is okay (regardless of non explicit disclosure) they can hardly then say to a firm that charged 2% for some and 3% for others 'you've got to give it all back'
There are claimants out there who think they are getting it all back which is clearly ridiculous. It is only 'excessive' amounts that should be refunded.
pavarotti1980 said:
OddCat said:
Regardless, you wouldn't be stupid enough to pay more for the beans than you were happy to.
Mate I would give up with your utterly ridiculous attempt at comparisons. If this wasn't an issue then it wouldn't now be banned and it has been repeatedly pointed out to you god knows how many times. It's like trying to communicate with a turnip
I am presuming there has been a shift in attitude over all this now, I have stopped / not received any communication from any of the companies that I reached out to in Feb, and I have been re-contacting them repeatedly as they all miss their 28 day deadlines. Zero communication from all.
I don't think much will come from this.
I don't think much will come from this.
Random_Person said:
I am presuming there has been a shift in attitude over all this now, I have stopped / not received any communication from any of the companies that I reached out to in Feb, and I have been re-contacting them repeatedly as they all miss their 28 day deadlines. Zero communication from all.
I don't think much will come from this.
Certainly all gone quieter and no updates on the MSE site either. I don't think much will come from this.
That said without chasing I did get my first reply from BMW the other day to apologise for the delay in replying to my original email and to ask for patience.
Santander sent me a random letter saying they had my DCA complaint and here was a ticket number. It went to my old address and the new tenant forwarded it to me. So I called them up and updated my address. Might have to do the same on the other accounts so as not to miss comms from them as I am presuming if it's posted it's going to the address you lived at at the time and not the address used to complain and file it.
I have had a reply from Vauxhall Finance!
Bought 'er indoors a 17 plate Viva automatic at three years old, ex motobility car. Bought on a PCP deal and I was certain that the main dealer sales guy mentioned zero rate finance, but I may easily have mis heard. At the twelve month point I received the annual finance statement and noted that we were actually paying 9.9% on the finance...but I was then in a position to clear the debt and I did so.
With the publicity given by MSE and others I submitted a claim, VF initialy claimed they could not trace the ageement, despite using the agreement number as a reference. I pointed out that the car was now showing a cherished 'plate and that enabled them to agree that I 'may have a claim', but they were waiting until the end of September to see what they were expected to do.
With only paying finance for a year I do not expect to be made an instant millionare, but any crumbs will be welcomed!
Bought 'er indoors a 17 plate Viva automatic at three years old, ex motobility car. Bought on a PCP deal and I was certain that the main dealer sales guy mentioned zero rate finance, but I may easily have mis heard. At the twelve month point I received the annual finance statement and noted that we were actually paying 9.9% on the finance...but I was then in a position to clear the debt and I did so.
With the publicity given by MSE and others I submitted a claim, VF initialy claimed they could not trace the ageement, despite using the agreement number as a reference. I pointed out that the car was now showing a cherished 'plate and that enabled them to agree that I 'may have a claim', but they were waiting until the end of September to see what they were expected to do.
With only paying finance for a year I do not expect to be made an instant millionare, but any crumbs will be welcomed!
ashleyman said:
This was the ad I mentioned earlier in the thread. Not sure how advertising like this is at all legal.
They're saying "Average claim for our partner law firm" not sure how you can even have an average when you've got no idea of what a claim might look like.
There is an inherent risk with things like PPI style claims which is that they're a brilliant way to capture punter data and create lucrative mugs lists to then spank and sell. They're saying "Average claim for our partner law firm" not sure how you can even have an average when you've got no idea of what a claim might look like.
People in a rush for some cash will have a tendency to end up at any old website agreeing to any old terms for their private data. That can then be used to spank them for all sorts, not just compo services but loans, investments, solar panels, anything that currently has a grant, fake discounts you name it.
And one of the things that makes the data more valuable is that it is a defined list of consumers with enough liquidity to be getting a new car and also feeling bullish about some free cash.
You get their name, all their context details and with their postcode you can filter them very quickly into the key groups and they've also given the salesteam the hook with which to start and build the conversation around that will lead to the eventual sale of multiple goods and services of no value.
Note how MSE go to pains to state they aren't collecting sales data as they wish to be segregated on this from the legion that are and will be.
alscar said:
Certainly all gone quieter and no updates on the MSE site either.
That said without chasing I did get my first reply from BMW the other day to apologise for the delay in replying to my original email and to ask for patience.
The FCA doesn't usually do anything unless told to by another regulator or a government. Sadly, many think it is some pro-active entity that is policing the financial markets but in reality it's more like a nightclub cleaner crew where doormen do a vague job of inhibiting the worst people, a couple of people are there to ask people to urinate in a certain place and not to do certain things but generally it's all about just cleaning up the blood, vomit and faeces after it's all happened. That said without chasing I did get my first reply from BMW the other day to apologise for the delay in replying to my original email and to ask for patience.
They're still struggling with the post 2016 environment where they can just sit doing nothing until the EU regulator changes something and instructs them to copy and post lockdown large numbers of staff now fake WFH.
So it would be very unusual and surprising if the FCA were to do anything without instruction and the only entity in regards to this one that would be in that position is really the Govt and that's now in election mode.
Now, it's worth noting that the real boom in the use of car credit happened post 2011 when the conservatives deleveraged the loony mortgage market to try and stabilise it by stopping people being able to borrow insane amounts that lenders knew would be close to impossible to pay back within a working life timeframe and which Govt knew would drive an asset inflation that would make everyone feel rich when they were in fact making themselves poorer. Within 12 months of the 2011 deleveraging of the property and BTL market the credit bulge had popped up in the car market. At the same time the consumer credit review shortly after was very odd as it gave a clear bill of health to car debt when it was using systems and tactics robustly outlawed in all other consumer lending markets because of their known toxicity.
In short, it's potentially a quick 'friend of the people' and 'it's all the money lenders fault' gig for the incoming Labour govt. They can claim they weren't responsible. They can blame Tory scum and filthy money lenders. It makes them a friend of the people and any cash paid out will be spent in seconds and in reality spent twice as the average punter will spend the amount they think they're going to get when they start the process and then when they do eventually get some money 6/12 months later they will have forgotten they had already spent it and spend it again.
So the FCA may go quiet now but I don't think it would be a huge surprise for the next govt to wake them back up on this one and deliver formal instruction.
ashleyman said:
This was the ad I mentioned earlier in the thread. Not sure how advertising like this is at all legal.
They're saying "Average claim for our partner law firm" not sure how you can even have an average when you've got no idea of what a claim might look like.
Certainly pushing the limits of what any advert should say and suggesting that all of the interest potentially is reclaimable ?They're saying "Average claim for our partner law firm" not sure how you can even have an average when you've got no idea of what a claim might look like.
I guess they will attract some clients on that basis though.
DonkeyApple said:
alscar said:
Certainly all gone quieter and no updates on the MSE site either.
That said without chasing I did get my first reply from BMW the other day to apologise for the delay in replying to my original email and to ask for patience.
The FCA doesn't usually do anything unless told to by another regulator or a government. Sadly, many think it is some pro-active entity that is policing the financial markets but in reality it's more like a nightclub cleaner crew where doormen do a vague job of inhibiting the worst people, a couple of people are there to ask people to urinate in a certain place and not to do certain things but generally it's all about just cleaning up the blood, vomit and faeces after it's all happened. That said without chasing I did get my first reply from BMW the other day to apologise for the delay in replying to my original email and to ask for patience.
They're still struggling with the post 2016 environment where they can just sit doing nothing until the EU regulator changes something and instructs them to copy and post lockdown large numbers of staff now fake WFH.
So it would be very unusual and surprising if the FCA were to do anything without instruction and the only entity in regards to this one that would be in that position is really the Govt and that's now in election mode.
Now, it's worth noting that the real boom in the use of car credit happened post 2011 when the conservatives deleveraged the loony mortgage market to try and stabilise it by stopping people being able to borrow insane amounts that lenders knew would be close to impossible to pay back within a working life timeframe and which Govt knew would drive an asset inflation that would make everyone feel rich when they were in fact making themselves poorer. Within 12 months of the 2011 deleveraging of the property and BTL market the credit bulge had popped up in the car market. At the same time the consumer credit review shortly after was very odd as it gave a clear bill of health to car debt when it was using systems and tactics robustly outlawed in all other consumer lending markets because of their known toxicity.
In short, it's potentially a quick 'friend of the people' and 'it's all the money lenders fault' gig for the incoming Labour govt. They can claim they weren't responsible. They can blame Tory scum and filthy money lenders. It makes them a friend of the people and any cash paid out will be spent in seconds and in reality spent twice as the average punter will spend the amount they think they're going to get when they start the process and then when they do eventually get some money 6/12 months later they will have forgotten they had already spent it and spend it again.
So the FCA may go quiet now but I don't think it would be a huge surprise for the next govt to wake them back up on this one and deliver formal instruction.
Of course any money that " Labour " may get me back will no doubt into insignificance from what their victory will no doubt cost me - hey ho.
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