Handing a car back to finance company has left me with default threats, & harrassment

[jooly35]

Hope someone can help advise me here.
4 months ago, I wrote to finance co. to terminate HP contract & return car. I had paid 65% but car was worth less than I owed even at early settlement. Having spent £2000 on repairs, I felt it was my only option at purchasing a new car. I never defaulted any payments. Finance co took 4 weeks to collect car from a local garage. They then started ringing me & asking for payment for damage to car. I pointed out that it was in very good condition, to which local garage agreed and I added that ariel was already broken when purchased and battery was flat as car had stood for 4 weeks.
I had nothing in writing and hadn't heard anything for 4 months when I received a call to say that I owed £2200! After arguing the case I was promised an update. Receievd nothing for a few days, then a call asking for £365.00. I said that I disputed these charges and now felt harrassed by company. Caller said as measure of good will, they would drop payment to £200. I stood my ground to then receive threats that company would default me and give me a bad credit report.
Wondered if anyone has experienced similar. Feel like just giving in, but don't believe that I should owe them money. Can they default me without my knowledge?
Best regards y'all.

[callumsgran]

no if they are going to default you they have to tell you!

[jooly35]

Thanks, I can sleep tonight. Never been inthis situation before and am quite stressed.

[callumsgran]

p.s they actually have to send you a default notice, glad i could be of service

[sequenci]

if you have paid 50% of the agreement you are entitled to return the vehicle so long as you have put the request in writing. this is called voluntary termination and it is part of the consumer credit act. the firms do try and fob people off citing damage and the like and usually we advise our clients to take photographs just in case. if they have defaulted you without notice that is VERY naughty. it might be worth speaking to the credit reference agency in question and see what can be done.

in the meantime here is more info on hire puchase >>

http://www.nationaldebtline.co.uk/en..._purchase_debt

edit: i just need to double check, you never defaulted on payments prior to returning it?!?!

[jooly35]

Thanks for advice. No, I never missed a payment and paid 65% before vt. Did put it in writing, but didn't take any pics. The few things they reckon add up to £365 are there, but as I said, the car was 7 year old, you would expect to find a few scuffs on the bumper. I just feel they are trying to bully me into making some sort of payment. Feels like the girl in question is working on commission!

[sequenci]

well they should expect general wear and tear.

[stadium_arcadium]

Hi Jooly, I was in a similar position about 10 years ago, and a company did the same to me, tried to get me to pay for damage that was already there etc. I stood my ground and eventually went through arbitration. The judge was completely on my side, and knew the tactics of credit companies like these, and I came out of there feeling so euphoric. I didn't have to pay anything at all to them, plus the judge made their rep look and feel like a fool. That was the most satisfying thing ever
Hope it all goes well for you and if push comes to shove remember the law is on your side

[steveoram1]

Hi - I work as a finance manager in a big car supermarket & look at finance docs all day. The wording in the termination clause says "You have a right to end this agreement. To do so you should write to the person you make your payments to. They will then be entitled to the return of the goods and half the total amount payable under this agreement, that is £XXXX. If you have already paid this amount plus any overdue instalments and have taken REASONABLE care of the goods you will not have to pay any more." It seems to me that "reasonable" is quite a subjective term. Anybody could reasonably expect a 4/5 year old car to have a few dents & scratches. Heres something important to look out for - at the time of taking out the agreement most people also buy one or more insurance products (PPI,Gap etc). There is normally a separate CREDIT agreement for these (NOT HP). Sometimes this is not made clear when signing and the signatures are normally on the same page - these amounts would still be owed to the finance company even if the car is handed back so if you have taken out a £2000 PPI policy chances are you will still owe £1000. PPI is the most profitable part of a finance deal for both the finance company and the dealership and the cover offered is available for about a fifth of the price charged through standalone products - try googling PPI or CPI. If anyone has any other queries about car finance PM me.