Changing Mind on Finance Deal
Discussion
Hi
My wife is buying a new Mazda2 and they are offering £1000 off the amount of credit. It is a PCP agreement and the £1000 is included as part of the deposit.
I have seen a copy of the Santander agreement (not yet signed) and we are considering using the 14 day change of mind clause; paying back the full amount of credit; then only having to incur their daily interest charge of 91p. This way we would benefit from the £1000 saving, which is not available on a cash purchase.
Can anyone confirm if this can be done without incurring any other penalties/fees?
The wording on the document says "If you withdraw from the agreement within 14 days you should note that,
If we have paid the amount of credit on your behalf (by acquiring the goods), you must repay this amount (or any lower amount if you have made any repayments) together with interest payable on that amount to us within 30 days, beginning the day after you give us your notice of withdrawal. Interest will be charged on the amount of credit at £0.91 per day beginning on the date when the amount of credit was provided and ending when the credit and accrued daily interest is repaid.
You will be required to purchase the goods financed by the agreement and so you will need to have an alternative means of paying for these goods.
We will remain the owner of the goods until you have paid for them."
My wife is buying a new Mazda2 and they are offering £1000 off the amount of credit. It is a PCP agreement and the £1000 is included as part of the deposit.
I have seen a copy of the Santander agreement (not yet signed) and we are considering using the 14 day change of mind clause; paying back the full amount of credit; then only having to incur their daily interest charge of 91p. This way we would benefit from the £1000 saving, which is not available on a cash purchase.
Can anyone confirm if this can be done without incurring any other penalties/fees?
The wording on the document says "If you withdraw from the agreement within 14 days you should note that,
If we have paid the amount of credit on your behalf (by acquiring the goods), you must repay this amount (or any lower amount if you have made any repayments) together with interest payable on that amount to us within 30 days, beginning the day after you give us your notice of withdrawal. Interest will be charged on the amount of credit at £0.91 per day beginning on the date when the amount of credit was provided and ending when the credit and accrued daily interest is repaid.
You will be required to purchase the goods financed by the agreement and so you will need to have an alternative means of paying for these goods.
We will remain the owner of the goods until you have paid for them."
steve789 said:
Hi
My wife is buying a new Mazda2 and they are offering £1000 off the amount of credit. It is a PCP agreement and the £1000 is included as part of the deposit.
I have seen a copy of the Santander agreement (not yet signed) and we are considering using the 14 day change of mind clause; paying back the full amount of credit; then only having to incur their daily interest charge of 91p. This way we would benefit from the £1000 saving, which is not available on a cash purchase.
Can anyone confirm if this can be done without incurring any other penalties/fees?
The wording on the document says "If you withdraw from the agreement within 14 days you should note that,
If we have paid the amount of credit on your behalf (by acquiring the goods), you must repay this amount (or any lower amount if you have made any repayments) together with interest payable on that amount to us within 30 days, beginning the day after you give us your notice of withdrawal. Interest will be charged on the amount of credit at £0.91 per day beginning on the date when the amount of credit was provided and ending when the credit and accrued daily interest is repaid.
You will be required to purchase the goods financed by the agreement and so you will need to have an alternative means of paying for these goods.
We will remain the owner of the goods until you have paid for them."
If I'm reading this right, you're getting a grand off for using their finance, but your looking to repay within the first 14 days and thus stiff them for a grand by having repaid the amount financed?My wife is buying a new Mazda2 and they are offering £1000 off the amount of credit. It is a PCP agreement and the £1000 is included as part of the deposit.
I have seen a copy of the Santander agreement (not yet signed) and we are considering using the 14 day change of mind clause; paying back the full amount of credit; then only having to incur their daily interest charge of 91p. This way we would benefit from the £1000 saving, which is not available on a cash purchase.
Can anyone confirm if this can be done without incurring any other penalties/fees?
The wording on the document says "If you withdraw from the agreement within 14 days you should note that,
If we have paid the amount of credit on your behalf (by acquiring the goods), you must repay this amount (or any lower amount if you have made any repayments) together with interest payable on that amount to us within 30 days, beginning the day after you give us your notice of withdrawal. Interest will be charged on the amount of credit at £0.91 per day beginning on the date when the amount of credit was provided and ending when the credit and accrued daily interest is repaid.
You will be required to purchase the goods financed by the agreement and so you will need to have an alternative means of paying for these goods.
We will remain the owner of the goods until you have paid for them."
robnokia said:
Legal maybe but wouldn't be acceptable to me. Why do people think it's ok to stiff companies?
Why do companies think it's OK to stiff consumers by giving discounts for using finance? They write the terms; if you can still benefit from the discount by paying off the finance within days, that's just business.It might only be a grand here, but for something like the BMW 5-series GT, the dealer deposit contribution is £4,500; on the 6-series it's £6k and on the 7-series it's £7k. That's a discount but only if you pay using finance. Why should the customer lose out by paying cash?
Edited by Jobbo on Friday 21st September 07:54
Jobbo said:
Why should the customer lose out by paying cash?
Exactly. They produce all these slick ads saying you can save £££ by having credit, but what happened to the days of "Cash is King"?The dealer is OK with what we plan to do and my wife is going to ring Santander to query her options on repaying early just to make absolutely sure.
And as previously mentioned, as long as we comply with the legal terms we are doing nothing wrong.
Your quoted terms refer to the new Consumer Credit Directive that came in last January. You have the wright to withdraw from the finance and pay it off (14 day cooling off). You also have the wright to pay off lump sums at any amount and frequency.
However is it moral to take it ?
We offer the same discount offers, we also run reports on which dealers have customers cancelling the deals within 14 days, 1 month & 3 months. Any dealers with more than 1 a month get fined, otherwise the dealers would start selling the "take the finance and clear it" route.
In reality the finance company will make a small loss (depending on any admin fees) but the manufacturer subsidises the finance company for these offers, so your taking your £1000 from the manufacturer and then sticking 2 fingers up. I wonder how well they will respond to your warranty claims after youve done that !!!!!
In the real world, this happens sometimes but not that often, you will benefit from it. When the manufacturer hits a certain cancellation rate, they stop the offer.
However is it moral to take it ?
We offer the same discount offers, we also run reports on which dealers have customers cancelling the deals within 14 days, 1 month & 3 months. Any dealers with more than 1 a month get fined, otherwise the dealers would start selling the "take the finance and clear it" route.
In reality the finance company will make a small loss (depending on any admin fees) but the manufacturer subsidises the finance company for these offers, so your taking your £1000 from the manufacturer and then sticking 2 fingers up. I wonder how well they will respond to your warranty claims after youve done that !!!!!
In the real world, this happens sometimes but not that often, you will benefit from it. When the manufacturer hits a certain cancellation rate, they stop the offer.
LancerG said:
In reality the finance company will make a small loss (depending on any admin fees) but the manufacturer subsidises the finance company for these offers, so your taking your £1000 from the manufacturer and then sticking 2 fingers up. I wonder how well they will respond to your warranty claims after youve done that !!!!!
So are you actually saying that if customer backs out of a (Manufacturers) finance agreement, then they will then invalidate. or at least make the Warranty "Hard" to claim against?Sorry, but that is utter drivel. In my many years (a few years ago now) behind the service counter, this NEVER happened. How would the Service Department ever be aware of this? Or do "Business Managers" nip round to the Service Dept and pre warn the service team that they had been stitched up?
750turbo said:
So are you actually saying that if customer backs out of a (Manufacturers) finance agreement, then they will then invalidate. or at least make the Warranty "Hard" to claim against?
Sorry, but that is utter drivel. In my many years (a few years ago now) behind the service counter, this NEVER happened. How would the Service Department ever be aware of this? Or do "Business Managers" nip round to the Service Dept and pre warn the service team that they had been stitched up?
I agree, i can hardly see the finance side getting the cancellation then nipping down and detting the service desk to make warranty claims hard. Just seems so far fetched. Then what if you go to a different dealer.Sorry, but that is utter drivel. In my many years (a few years ago now) behind the service counter, this NEVER happened. How would the Service Department ever be aware of this? Or do "Business Managers" nip round to the Service Dept and pre warn the service team that they had been stitched up?
Go for it. As said above you can even wait a month and just ask for a settlement figure. Even if after 14 days.
Good on you. If it was the other way around the company wouldn't care if the customer was stitched up. Only reason they have fixed up is because of all regulations imposed on them. I have worked in a main dealer. Ad know that if the sales team can he away with it they charge up to 15% interest if its clear the customer hasn't got a clue. All links to dealer and salesman commission.
Good on you. If it was the other way around the company wouldn't care if the customer was stitched up. Only reason they have fixed up is because of all regulations imposed on them. I have worked in a main dealer. Ad know that if the sales team can he away with it they charge up to 15% interest if its clear the customer hasn't got a clue. All links to dealer and salesman commission.
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