Blackhorse finance / suggested I voluntarily terminate the agreement

[proudtobegerman]

Good Morning !

 

Some advice needed please. Would be great to see what people think my next move should be.

 

I bought a car in 2006 through BMW, financed by Blackhorse. In 2008 my mother died suddenly from cancer and as a result I had to support my father who himself was rather ill. I phoned Blackhorse and they suggested I voluntarily terminate the agreement. I did this and returned the form that they sent. I still have a copy of this. The company that collected the car were Nationwide Vehicle Collections and they provided a receipt upon collection, dated 20th December 2008.

 

Some 6 months later, Blackhorse wrote to me saying that I owed them £5468. I wrote back asking what this was for, and they wrote back saying that figure was wrong and infact I owed them £3512. This figure included a breakdown of costs. To my horror this breakdown of costs included repossession fees ! The car wasn't repossessed.

 

I wrote to Blackhorse and did a SAR. Some 7 months later they replied ! I had sent another 6 letters by this time.

 

Eventually I got the credit agreement and another letter stating that Blackhorse excercised their right under the agreement and repossessed the vehicle. They made it clear by stating this in 4 paragraphs of the letter.

 

In the credit agreement it states that if I have paid more than 1/3 of the total amount owing under the agreement then the car cannot be repossessed without a court order. The total amount owing was £29145, I had paid, £11525. More than 1/3. The agreement goes on to say that if they do take the car without a court order then I'm entitled to all the money back.

 

I wrote to Blackhorse and said, "As you are now saying the car was repossessed, I would like my £11525 back" etc etc as per above.

 

Blackhorse have replied by saying that internally, repossession and voluntary termination mean the same thing. So when a letter is written saying your car was repossessed it actually means voluntarily terminated ! They have also stated that as only one letter sent to me states the car was repossessed they need more evidence that the car was repossessed !!!! More evidence of what ?!?! They were chasing me and hounding me, sending people to my door for the money they said I owed them, a large proportion of it being repossession fees and now that I have picked up on a clear breach of contract they are saying, they didn't mean repossession and that was a mistake !!!!! What evidence should I have to provide ?

 

They have also agreed to write off the money they think I owe them and amend my credit file ! But I don't want to let them off that easily, and why should I !!!

 

Next move ?!?!?! Any ideas ?!?!

[postggj]

how did you inform blackhorse you wish to do a vt

 

was it in writing and did they acknowledge the request in writing

[mcjohnson]

Hi,

 

Under a hire-purchase agreement you can't voluntarily terminate a contract until the 50% point, which you had not reached. As such they should not have offered you a voluntary termination as an option. Therefore they should not have taken the vehicle and, by doing so without issuing either default or termination notices nor without a court order (as over 1/3rd had been paid) it is technically a repossession.

 

They will argue, until they are blue in the face, that you've voluntarily surrendered the car - but unless they've sent you any documentation with the words 'voluntary surrender' on - do not accept that argument at all.

 

Clearly, internally, they've realised that you hadn't reached the 50% point and, as such, they're treating it as a voluntary surrender - whereby you would be liable for any balances owing after the disposal of the vehicle (probably at auction, probably for peanuts). Don't accept this at all; as the liabilities under a voluntary surrender are far more punitive than under a voluntary termination.

 

To answer your exact question - why should you let them off? Because you've already got what you originally wanted, in that the amount owing has been wiped and your credit file has been amended. As such, what you're now endeavouring to do is enrich yourself based on their 'error'. The risk you run is that they will take the hard line that you approached them about terminating the agreement before the 50% point had been breached, as such they could contest that contractually you were aware this would be a voluntary surrender and pursue you for the balance.

 

There is a significant amount more evidence that you approached them about terminating the contract early, than there is about any repossession. So it's whether you want to run that risk.

Edited May 8, 2011 by mcjohnson

[Jasper1965]

Hi,

 

Under a hire-purchase agreement you can't voluntarily terminate a contract until the 50% point, which you had not reached. As such they should not have offered you a voluntary termination as an option. Therefore they should not have taken the vehicle and, by doing so without issuing either default or termination notices nor without a court order (as over 1/3rd had been paid) it is technically a repossession.

 

You can VT at any time, even if in arrears in certain circumstances.

The 50% rule is an upper limit on liability under the agreement, if the 50% point has not yet been reached then the 'debtors' liability is limited to (50% - amount already paid ) + any arrears outstanding at time of VT + any extraordinary charges eg poor condition/damage to vehicle.

eg if agreement is valued at £15,000 total of which £1500 was paid as a deposit the 50% point is reached when the debtor has paid £6,000 of monthly payments.

Assuming no damage to vehicle incurring costs and collection costs are £250 then on the same agreement as above if the debtor had paid £2,000 in monthly payments before choosing to VT they would be liable for £4250 upon return of the vehicle.

But and it's important to understand this unless the OC has already defaulted/terminated the agreement the debtor can VT at any time and limit their liability.

 

As for the rest I'd be worried that the SAR will turn up with a recipt from Nationwide and a statement from the repo guy to the effect that you permitted him to take the keys and logbook which would likely blow any case brought as claimant out of the water. If you hadn't given them permission to remove the vehicle things would be very different, as it is I would concentrate on getting a firm decision in writing from them to the effect that any outstanding balance claimed has been extinguished, your credit files marked as satisfied with no default balance then I'd sit back do the sums and say well I'm about 4 grand better off than I should be not a bad result.....

 

You could try for the balance due under Sec 90 but that's your decision and one I would advise you approach cautiously as the sum is enough to take you into costs bearing court and the Black Horse legal fees wont be cheap.

Edited May 8, 2011 by Jasper1965

[Gaston Grimsdyke]

A debtor can exercise the right to VT any time they wish (assuming the has not already been terminated by the creditor for breach). You could even VT the day after the agreement was signed if you like (though it would be stupid). The 50% bit comes in because, once you have handed the car back, you then have to pay such sum as is required to bring the total paid up to 50% of the total purchase price. Looking at the figures you have posted, it appears they are pursuing you for that remainder. If the TPP is 29K, half of it is 14.5K. You've paid 11.5K, so you owe them 3K-ish. Actually I think the advice to VT by Black Horse was probably correct, they will have suffered a big loss on the sale of the vehicle so it was definitely in your interests to VT rather than let them terminate and pursue you for the shortfall on the sale. On a VT, it is the creditor who swallows the loss on the resale. If you did VT, which it sounds like you did, then there was no need for them to get a court order.

 

Appears to me like BH got mixed up about VT liability and a VS liability. The higher figure they asked for was probably the actual loss on the agreement, the lower one the statutory VT liability. Doesn't help that they use expressions like "repossession" in a VT scenario. I would ask them for a calculation of the VT liability they say is now owing.