Financial Agreement Commision Indemnity

[tallulah59]

Hi,
I'm having bother with a car dealer who is trying to claim nearly £3000 through the County Court and was wondering if anyone else has come across this problem. I part-exed my vehicle last year against another car and was told by the salesman that I couldn't part-ex or sell the new vehicle for at least a year. The following January, I re-mortgaged and paid the car finance off to reduce my outgoings. The dealer then sent me a bill for £2,432.82, claiming that I had signed a 'Financial Commission Indemnity Agreement' at the time of purchase, which stated that I had to make at least 12 monthly payments or they would 'claw back' this amount (this was never mentioned by the salesman, who kept repeating that I had to keep the car for at least a year, which I did). I strongly refuted this, but they produced an alleged copy of the document, with my name, address and signature. I had never seen this document before and, not suprisingly, the part which read 'I acknowledge a receipt of the copy of this agreement' was blank. Does this mean it is unenforceable? The matter has now gone to court and further costs have been added, as I have refused to pay. I have just returned my allocation questionnaire and am waiting for a reply. Does anyone have any advice?

[old_andrew2007]

when do expect a reply from the court

[tallulah59]

Hi there,
I'm not sure, but I'll update when I find out. I've told them dates that are unavailable so basically, the ball is in their court (oops, that wasn't meant to be a joke!). I was also asked if I'd like to resolve the matter beforehand, which is a bit pointless as I have no intention of giving them a penny, even if the case goes in their favour.

Cheers

[daKlone]

Never heard of such a thing!

I imagine that it is some sort of agreement between the dealer and the finance company that means that the dealer only gets his cut of the finance profit if you make at least 12 monthly payments. Did you make 12 payments can I ask?

I'd have thought that if you paid it off early, then less interest would be owing, potentially cutting out any profit for the dealer (which I imagine is why such a indemnity thing exists).


I'm no expert, but I can't see how they can inforce it if they don't have an acknowlegement copy?

[tallulah59]

Hi,
I paid the finance off about 7 months after buying the car. As I was told that I couldn't sell or part-ex the vehicle for 12 months (I did neither) I don't see any reason why I should be charged nearly £3000. If I had known about this, I would have waited before paying off the finance as it would have been considerably cheaper. I would certainly not have signed such an agreement without demanding a copy! I believe that the document they produced was either altered or forged. The salesman repeated over and over that I would have to keep the car for at least a year (which I did). The only reference to a penalty (no specific sum was mentioned) concerned the sale or part-exchange of the vehicle, not paying off the finance.

[miniconverter]

When a car is sold on finance the dealer gets a commission from the finance company. This commission comes with clauses which include what is generally known in the motor trade as a debit back. This is where the finance company recovers from the dealer part of the commission paid to them if the finance is paid of early or before a set date or number of payments and is normal every day practise. I have never heard of any dealer having an agreement with the customer not to sell the car or pay of the finance and I have worked for and know some pretty dodgy dealers. Why not speak to the finance company and ask them if they are aware of these agreements where you end up paying the dealer for his loss of commission. Dealers as a rule will buckle very quickly if put under any pressure from a finance company.

[tallulah59]

Thanks miniconverter,
I'll contact Black Horse and see what their take is on it, never thought of that before!
Cheers