Voluntary termination - help / advice needed

[Sare Heid]

Hi,

 

2 yrs ago entered into personal contract hire agreement with masterlease, all payments made on time and account well managed until the recession bit hard and found myself out of work. have managed to maintain payments although this is now a struggle and have served notice on masterlease of my intention to voluntarily terminate, as i dont want to get into arrears / default situation.

 

duration of hire agreement was for 3yrs (3 + 35 payments), have paid well in excess of 66% of total agreement sum, however lease company say CCA doesn't apply and they will require an early termination payment. they suggested that other alternative was for them to just repossess and enter default on my credit file!

 

the contract hire agreement stated that it was regulated by the consumer credit act, and although section 101 deals with hire agreements, this depends on amount of hire charges paid per annum.

 

if any CAGers have had similar experiences or have any particular knowlege of these type of agreements, any advice / thoughts / comments on how best to deal with this would be greatly appreciated.

 

cheers

 

SH

[sequenci]

Hello there, welcome to the forums.

 

Does the credit agreement state regulated hire agreement or regulated hire-purchase agreement? If it is the former then I don't think you will have the same termination rights as HP.

 

Best wishes,

 

Seq.

[Sare Heid]

Hi Sequenci,

 

Thanks for responding so quickly.

 

The agreement is headed 'HIRE AGREEMENT REGULATED BY THE CONSUMER CREDIT ACT 1974'.

 

Annual hire charges are in excess of £4k so if my interpretation is correct, doesn't look as if section 101 will give any protection.

 

The agreement itself refers to 'an early termination sum' which can be supplied by the Hirer, however having read through the T&C's there is nothing to say how this will be calculated, should this not have been specified as a prescribed term otherwise how is the hirer expected to know exactly what his liabilities are? Would this be covered in any other regulations perhaps or trade association guidelines?

 

Really hoping you can help with this

 

Cheers

 

SH

[Tingy]

I'll leave seq to advise you, but I will say from experience be very careful and know exactly what you're doing before you do it. We handed a car back some years ago trusting the finance company that this was the best route. It was the worst thing we could have done. The charges after they'd got the car back were horrendous and they simply auctioned it off for a fraction of its value and deducted this paltry amount (less auction fees) from the outstanding balance. So please, be careful.

[Sare Heid]

Hi all,

 

Just adding a quick update for your information & hopefully might get some helpful feedback.

 

Sent a copy of the Contract Hire Agreement to local TS Office who were very good, had a good look through cca & got back to me within 24hrs with feedback although unfortunately it wasn't what I was hoping to hear.

 

Basically, the Contract Hire company can charge total of monthly hire charges owing and still due up to end of hire period, although they did offer a discount of approx 28% for early settlement. Bearing in mind that we wanted to voluntarily terminate due to lack of cash and avoid repossession, quite generous of them (not!) to allow us to terminate and return car for the not unsubstantial sum of nearly £2.5k.

 

Asked contract hire company if they would consider accepting the discounted monthly payments to continue with hire for the remainder of the contract period, that was met with short shrift and a demand for current arears and termination sum in full.

 

Have now received a DN which appears ineffective since it doesnt comply with prescribed format & content, this implies termination if not remedied by stated date although haven't received a notice / letter of termination yet. Should I write and point out defects with DN or just accept unlawful recission?

 

As always, would be grateful for advice and assistance.

 

Cheers,

 

SH

[mcjohnson]

Sare - Just to clarify - In the initial post (24th November) you stipulate that all the payments had been made to date and the account was in good order. Today (12th Jan - just 6 weeks later), apparently there are arrears being demanded and default notices have been issued. Did you stop making payments, or were you in arrears when you made your original post?

[Sare Heid]

mcjohnson,

 

As I mentioned in original post, we had managed to maintain payments however this was a struggle and therefore due to circumstances we decided early termination was probably best option since we had more important priorities. At time of original post, Nov payment was a week or so late and we haven't been able to make the Dec payment either, which is presumably why they've now issued the DN.

 

Hope this makes it a bit clearer.

 

SH

[Sare Heid]

Reps from Anglia Collections & Recovery Ltd have arrived (18:35) to recover Contract Hire car, have received DN but not TN, reps dont have any official paperwork other than photocopy of order from Masterlease - are they allowed to collect?

[Guest repo threat]

If you look at your original Hire Purchase agreement, have you paid for example:-

 

A) Amount of Credit (C-D) £11,590.00 Advance

 

B) Total Amount Payable (A+D+E) £15,583.00

 

C) Total Cash Price £13,025.00 Price of Vehicle

 

D) Advance Payment £1,435.00 Deposit

 

E) Total Charge for Credit £2,558.00 Interest+Fees

 

On the front of the Hire Purchase Agreement is a section

 

“REPOSSESSION: YOUR RIGHTS

If you do not keep to your side of this agreement but you have paid at least one third of the total amount payable under this agreement, that is £5,194.33 we may not take back the goods against your wishes unless we get a court order. (in Scotland, we may need to get a court order at any time) If we do take the goods without your consent or a court order, you have the right to get back any money you have paid under this agreement.”

 

Now £5,194.33 is 1/3rd of the Total Amount Payable (A+D+E) £15,583.00.

 

have you paid more than 1/3rd as illustrated above ?

[Sare Heid]

This was a personal contract hire agreement and not a hp agreement so this didn't apply unfortunately.

 

Had the agreement checked out by local TS who confirmed this was the case.

[Sare Heid]

Could one of the site team merge with my original thread (Voluntray Termination - help / advice needed) please, started this one in haste / panic!

 

Cheers

 

SH

[IdaInFife]

threads merged

[Sare Heid]

A quick update on events to date;

 

Repo reps were sent packing, told them that I didn't have any notice of their visit, or paperwork from contract hire company and I told them not to touch car while it was on my property otherwise I would call police. They said would return next day after contract hire company had confirmed who they were and why they were there, which they did and car was collected next day. I completed inspection and signed copy to confirm responsibility was handed over to reps.

 

After reading DN again, it looked ineffective (insufficient time for remedy, incorrect amount of arrears, etc) so I wrote letter pointing out errors with DN and as they had effectively terminated agreement by sending repo reps to collect, accepted their unlawful recission of agreement.

 

Also, if I've interpreted s.92 CCA correctly, they should have had an official court document to either enter or recover the car from my property, which they didn't....does this mean they've acted unlawfully and will this add weight to the unlawful recission of the agreement?

 

To complicate matters, the car still carries our cherished number plate and they've sent letter giving 7 days to pay for transfer back to us or it will be sold with car. Can they do this if car was removed unlawfully / agreement unlawfully rescinded? Would we be able to counterclaim for damages due to loss of cherished item with sentimental value (cherished plate was for OH 40th birthday)?

 

Feels like I was ambushed with this and I should have been better prepared, only consolation is that they probably behave like this all the time and I hope I'm not alone.

 

Certain that this one has got some distance to run yet so would appreciate any helpful comments or pointers on where to go from here.

 

Cheers,

 

SH

[Guest repo threat]

SH

 

have you paid more than 1/3rd of the total price of the goods

[sequenci]

SH

 

have you paid more than 1/3rd of the total price of the goods

 

It's not HP. It's a HIRE agreement.

[Guest repo threat]

I have paid more than 1/3rd of the total price of the goods. it would seem EVERY employee at Black Horse is adamant that 1/3rd means 1/3rd of the opening balance (Total Price of Goods less advance payment) bit daft really cos that aint what it says on the section headed reposession your rights.

[sequenci]

I have paid more than 1/3rd of the total price of the goods. it would seem EVERY employee at Black Horse is adamant that 1/3rd means 1/3rd of the opening balance (Total Price of Goods less advance payment) bit daft really cos that aint what it says on the section headed reposession your rights.

 

You're right, it's the figure listed within the contract. It's not going to help the situation we have on this thread, however.

[Sare Heid]

Hi repo threat /sequenci,

 

thanks for your input, are you able to shed any light on the points I raised in my last post #13?

 

Was running out of time to reply regarding the cherished no. plate so wrote and told them that seeing as they had unlawfully rescinded agreement / recovered car, I still wanted to retain it & they woudn't be getting paid for transfer back to me....was I right?

 

Also, have now received a 2nd DN, dates have changed, though still only allows 14 days from date of issue, only significant change is increased amount of arrears they now say is due. I was thinking best to write back referring to my original letter re. defective DN & unlawful rescission, would you agree?

 

Its re-assuring to know help is not far away!

 

Cheers

 

SH

[Sare Heid]

Bumping - sorry if I appear impatient guys but want to keep the pressure on!

 

cheers

 

SH

[carpe73]

I wonder if someone could help me, we had a hp agreement which we took out roughly 9 years ago. We decided that we hand the vehicle back as we had paid over a third of wht was owing on the hp agreement, we arranged for the finance comp to collect the vehicle which they did eventualy, they sold the vehicle for about £2224.00.we never heard anything off the finance company after that until recently and they are asking for £14583.00, this amount is for missed payments plus interest for 5 years. I telephoned the solicitors who were acting on behalf of the finance company and they said they have upto 5 years to get in touch i challenged the amount and the fact that they hadnt been in touch for 5 years and why now, which they couldnt answer.I carried on challenging the amount and got a leter back within a week and they reduced the payment to £1453.00.which is £999 and interest. what I want toknow is are they allowed to chase us for this money even though we terminated the hp agreement 5 years ago they ave sent us a court letter basicay telling us that it will be going to court

[Tingy]

Have a read of this - it should explain a few things:

 

http://www.insolvencyhelpline.co.uk/debt_factsheets/how_to_deal_with_hire_purchase_debt.php#5

[Sare Heid]

Hi carpe73,

 

Have a look at info in link that tingy posted (post #21), there's some good info in there.

 

Was this an HP agreement, if so the cancellation sum should be shown on the CCA? If you dont have a copy of CCA, you could send request with £1 postal order to get a copy, which should confirm what the correct sum was. It would also specify whether the original creditor / DCA was entitled to add any charges or interest after termination.

 

When you terminated agreement with finance company, did you put this in writing, have you kept a copy? Were all payments up to date?

 

You say that this happened over 5 years ago and haven't heard from them since, any outstanding debt could be / or may about to become statute barred, depending on where you are in the UK.

 

Are you happy that these 'solicitors' are above board and not just another part of a DCA looking to try and get some money out of you? Was this just a letter delivered by standard post or actual court papers delivered by registered post. If you could scan letter /docs and post up (remove all personal info, references, etc!!) it would be useful for others in helping you.

 

Please remember - you should never communicate with these people over the phone, get everything in writing.

 

Also, don't acknowledge that you owe these people anything (unless of course you are happy that you do!), its up to them to prove what you owe and that they are entitled to collect it.

 

Try not to get too stressed or worry, hopefully some others will be along soon to give you more support and assistance. You might be better to start a thread of your own so that your posts / replies dont get lost or overlooked in this one.

 

Hope this has helped.

 

Sare Heid

[mcjohnson]

Sare - regarding post #13 actually wouldn't apply because when the guys came to repossess the vehicle (on the second occasion) you gave them the keys. Technically this counts as a voluntary surrender, and not a repossession. I am sure you could have told them to foxtrot oscar, and come back with a court order and they would have been obliged to do so (would need to read up on Hire agreement repossessions, but imagine they're pretty much aligned with HP repossessions. Morale of the story is no-one can enter your property without your invitation to repossess anything, unless they have a order of the court.

 

Carpe - You can't voluntary terminate a HP agreement having paid only 1/3 of the payments, at least 1/2 the payments have to be made. What you have (unwittingly) done, in all likelihood, is voluntarily surrendered your vehicle. In this case the creditor can pursue you for the deficit of the contract. They can pursue you for 6 years after the date at which you last acknowledged the debt (ie. made a payment, or contacted the company regarding the payment or contractual terms covering the vehicle). As 5 years have passed they are in last-chance saloon and trying to fish for cash before the 6 year point arrives, the debt becomes statute barred and carries the legal weight of a damp dishcloth. Personally I would deny any knowledge of the debt and ride them for every last minion of proof that the debt exists, is yours, and is perfectly legally binding before you even part with a penny. By that time you'll be past 6 years and can tell them to go swing...

[Guest repo threat]

thats an interesting take,

 

in my case the default notice misrepresented to me that i had paid less than 1/3rd, the recovery agent threatened to remove the vehicle by recovery lorry and i queried the 1/3rd. sure i gave him the key under duress, but only when he handed me a receipt confirming that i refused consent for the vehicle to be removed off my private drive, thereby confirming that the vehicle was not on the highway. I have issued claim under S90,91,92. CCA 1974

[Sare Heid]

mcjohnson,

 

The relevant section of the act is s.92(1), which is quite clear when it says 'Except under order of a court...... shall not be entitled to enter any premises to take possession of goods....', this applies to consumer hire agreements also. It's quite specific & doesn't say ' unless invited' or give the owner / creditor any other options.

 

They had already written rejecting my offer of voluntary termination so by turning up at our front door in the evening without any prior notice or invitation was, IMO, a clear indication of their intent to repossess without compliance with their statutory duty. This was confirmed by the repo agents who said that they would turn up next day with recovery truck and lift off my drive regardless. Also having issued a defective DN, I dont believe they were entitled to enforce it (repossess) = unlawful rescission! They should know better.

 

They've since issued a 2nd equally defective notice - how's that for sheer incompetence!

 

I tried playing fair with this bunch at the outset, even offered to pay reduced payments and extend the hire period, but no, it seems their greed got the better of them. If they have messed up in any way, I want to make sure it hits them where it hurts most...... in the pocket!

 

I'm no legal expert though and legal interpretation of consumer law by the lower courts would appear to be a bit of a lottery from what I've read so far, so, grateful as always for opinions and comment.

 

Cheers

 

SH