Welcome Finance HP Termination

[Puffstar]

I know - I know, worst decision ever. Anyway a slight naive and desperate me signed up for HP with Welcome. It had been for a rough few years, which had left me CCJ in circumstance beyond most of my control. I needed a car for work and after finding one I liked, the dealership sorted out a finance company for me. The screen price was £3500 and the payments were well within my budget as I have a reasonable income. Recently after clearing a fair bit of debt off, I've turned my attention to HP. The costs involved 28.6apr and total payable £5535 just seem daft (ah hindsight). I have been able to save over the last year and I am now in a position to buy a decent car outright.

 

I am 15 months into a 36 month agreement. The plan was to make final payment to make up to difference to the 50% mark as stated in the 'Termination: your rights box' and be done with it.

 

This is the point I step in to a minefield it seems!

 

Last week I sent a letter to Welcome, stating I was looking to exercise my right to termination and please could they send me a statement of my account so I could bring it up to the termination figure. Once this had done could arrange the return of the car. Welcome responded to my letter with a rather rude phone call and I realised this might not be a stress free process.

 

Welcome basically said I owe the full ammount for a rather worthless mechanical breakdown insurance, something that was presented as a requirement, not an option at the start of the agreement. He also said I owe for fees, though he couldn't tell me what they were. I have a perfect payment record. He then tried to pressure to agree to an ammount to pay and to arrange an inspection of the car. I would then be liable to any repairs to the car. It was at this point I refused to discuss it any further and I would be seeking professional advice. Welcome said I have seven days.

 

A phone call to the CAB will be happening tomorow, so I can take the contract along to an appointment asap. I went to the dealer I got the car from today and they were not interested in helping at all. Hopefully the CAB will be of help and if anybody has any additional advice please feel free to post.

 

Some of it is clear, but most if it is damn right confusing. I'll lay it out below hopefull it will make sense and somebody could give me the idea of my rights. These will also be my questions to the CAB.

 

The car was purchased from a 'normal' dealership. They are not an official Welcome Finance dealership, only the finance was arranged with Welcome? How does this affect things if at all? In short its a car financed by Welcome, but not supplied by them.

 

Termination Figure - To date according to my bank statements i have paid £1945.32. I paid £100 upfront, so to date I have paid £2045.32. The TERMINATION: YOUR RIGHTS figure is £2491.20. I presume I can send a cheque via recorded delivery for £445.88 along with an appropriate letter to legally terminate the HP? Any further arguments regarding money owed would be seperate to this?

 

Mechanical Breakdown Insurance - Luckily this is the only insurance that is attached to the account. I have signed for it on the contract, but like I said it was obligation and hence i signed for it. Cost of the insurance is £370. Amazing they charge interest on this too and final cost is £503.20 per the contract. I really don't want pay anymore than the 50% termination figure. They are telling me I would have to pay this on top as they pay it in advance to the insurance company. The small print is really vague on this. The PPI, which I dont have luckily, is covered by clause 15 in brackets. Clause 15 says you owe no matter what really and only refers to PPI. Mechanical Breakdown insurance is not mentioned. Again slightly confused over my rights.

 

Returning the car - This a bit of a worry. Basically the car I bought in the first place wasn't mint. There was already a slight dent in the door and various scuffs. The car is on a S 1998 plate so it wasn't an issue. In the time I've had it the aircon has stopped working. I had re-gassed, but it must have a break in the pipes somewhere. It recently had an mot and passed ok. It has all the kind of small issues most 1998 cars have. It was sold with a FSH but the dealership could not provide proper evidence, something I should have persued at the time. All i have got is an A4 print out with garages and mileage. Even on this the intervals are over would you would consider to be full. The car is pretty good in general, it's certainly no dog. Having read a few horror stories, I just know im going to be hit for stupid bill for stuf that was faulty on the car on purchase. When I bought it, it was old car?

 

When I went to the dealer today, he said the car would not be returned to him. Again this could be fun and games it seems. Judging by what I have read Welcome will try to get me to take it to a branch some 40-50 miles away or they'll charge me. My rights are pretty clear on this ie they cant do this?

 

I'll keep you all informed as to wether this turns in to a nightmare or not.

[Puffstar]

Well - Back from the local CAB and they were helpful, but pretty useless. It's drop ins only, so no appointments. Hour and half worth of waiting and there was no one savvy on HP or finance, just a luck of the draw advisor.

 

It's seems my research has been paying off though as I probably knew more than she did. Whilst not too up on things, the advisor did seem to think the contract from Welcome was sketchy. I must stress she was full of sound advice even if she didn't know the in and outs.

 

The outcome was that she pointed me in the direction of trading standards concerning the breakdown insurance.

 

What I have decided to do - I'm going to write to welcome using one of the goverment templates for a volutary termination and the car is to be returned. I will include a breakdown of what I have paid so far according to my bank statements and a cheque to bring the balance up to the termination figure. They will also be informed that all responses must be by post.

 

I will see how we go from there.

[Yasmin]

oh really good luck with yours. Same company, different problems....!

[crusty git]

yes car credit all over again

 

Good Luck you will win this

[Puffstar]

I'm starting to think a change of plan might be the best solution. looking at the figures, I can afford to go for an early settlement. Basically I have 3 grand saved for a car. if:

 

1 i do a volutary termination I have around 500 to pay to reach the termination figure. Plus then theres all the insurances and stupid costs they try to sting you with.

 

2 if I do a settlement according to rule 78 will be around £2800. A rough calculation here and it matched the figures roughly in the hp agreement for early settlement (Javascript Rule of 78 Rebate Calculator - Equal instalments) The car is worth £2-2300 on a private sale.

 

Any advice on early settlement?

[kp278]

hi, what did you do in the end? i've had an inspection report and have a feeling welcome are going to try and charge me for "damage" already on the car when i bought it.

[Young Skywalker]

Welcome Finance is owned by Cattles Group. Cattles Group shares have been suspended, and looks likely to go bankrupt because it cannot pay it's debts.

 

How ironic that a company like this, that preys on the weak and vulnerable, charges them extortionate fees and levels of interest, is unable to pay it's bills !

 

http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article6122307.ece

 

If I had an agreement with Welcome Finance (Cattles) I'd be cancelling my direct debit right now, and these clowns wouldn't get another penny of my money.

 

I think if this company went bankrupt on 1st July (deadline for talks with it's Debt Providers), that would be Most 'WELCOME' !

[Mollymoo11]

Hello There!

 

I have phoned Welcome Fiance office today and they said i could do the temination over the phone which i did..lovely i thought.

She has just phoned me back now saying i will have to pay a liability fee of £1370 for the payment protection etc taken out.

 

I have currently payed back over half of what is owed on the car and had it for 2 years and 5 months exactly..

CAN I NOW CANCEL MY DIRECT DEBIT? DO I HAVE TO PAY THIS LIABILITY FEE?

I WORRY THAT THIS IS GOING TO BE CHAOS??!

 

Thanks alot for nay advise!!

 

Hannah, South Wales xx

[postggj]

you do not have to pay the insurance liability fee

demand they put that statement in writing BEFORE YOU CAN VOLUNTARY TERMINATE

 

you voluntary terminate the car agreement and the micky mouse insurance is left behind

 

you then go after welcome for mis-selling

 

YOU PUT THE VT REQUEST IN WRITING AND SEND RECORDED DELIVERY

 

DONT BELIEVE A THING THEY SAY ON THE PHONE

Edited May 17, 2011 by postggj

[Mollymoo11]

Thank you so much for replying so quick!

 

Massive help and i will definately send a letter recorded delivery? Anything specific i need to put in the letter? I will state how much is paid off already etc...

 

When can i cancel the Direct Debit?

 

Thanks again!

Hannah, South Wales

[Mollymoo11]

Hi Again,

 

I have recieved a letter from Welcome confirming that i have informed that i want to terminate the agrrement, which says what i have to pay:

'SEPERATE AGREEMENT LIABILITIES' - 1,370.06 pounds!

 

So i am just reading through all the paperwork and agreements that i signed when having the car, i took out:

PAYMENT PROTECTION INSURANCE

MECHANICAL BREAKDOWN INSURANCE

SHORTFALL EXTRA INSURANCE

 

I have just come across a section in the agreement:

'YOU HAVE A RIGHT TO END THIS AGREEMENT. TO DO SO, YOU SHOULD WRITE TO THE PERSON YOU MAKE THE PAYMENTS TO. THEY WILL THEN BE ENTITLED TO THE RETURN OF TH GOODS AND TO HALF THE AMOUNT PAYABLE UNDER THIS AGREEMENT, THAT IS: 4,652,5. IF YOU HAVE ALREADY PAID AT LEAST THIS AMOUNT PLUS ANY OVERDUE INSTALMENTS AND HAVE TAKEN REASONABLE CARE OF GOODS, YOIU WILL NOT HAVE TO PAY ANY MORE'

 

So i am so confused as to what this 'Seperate agreement liabilities' fee is, what should i do next?

 

Thank you for your help!!

 

Hannah, South Wales xx

[raydetinu]

unfortunately IMO you would be still liable for the seperate insurances ( usualy stopped at the time you terminate, but have a cancellation fee?) as they have nothing to do with the vehicle purchase.

so if you have paid the termination amount, which would not include any amounts paid for the insurances, you have to deduct these amounts from the amount paid to date.

There must be a breakdown of how your payment is made up on the agreement.

[Mollymoo11]

Oh right ok, so if i have paid £7,000, the total amount was £13,000 so i have paid £1000 over the half way amount, so that extra £1000 that i have paid could be taken as the Liabilities fee??

 

Thanks

Hannah xx

[postggj]

no

 

what happens is you terminate the hp side of the agreement and owe nothing

 

they then ask for the insurance crap

 

you then go for mis-selling

 

ime with you all the way

[raydetinu]

Nope! unfortunately.

you must work out from your payments how much you paid monthly went on the car and how much went on the additional items, insurance etc.

That should be in your agreement somewhere. Only the amount that contributes to the car payments are considered in making up the 50% value noted in the agreement.

Have you now terminated the agreement in writing, any payments you have made after this date must be returned.

I would also mention that you may be able to claim the PPI element back if you did not specifically ask for it or need it. ( plenty of claims about this in the media at the moment )

Just write to them claiming it back as you did not want it.

[postggj]

you must work out from your payments how much you paid monthly went on the car and how much went on the additional items, insurance etc.

 

that will be on the agreement or statement of price document

 

Only the amount that contributes to the car payments are considered in making up the 50% value noted in the agreement.

 

also minus any deposit made against the car

[Mollymoo11]

£79 a month for the extras and i apid £100 deposit?

 

I dont think i can go after them as i did sign to have the PPI and extras, i was told i should have them so i stupidly did.

 

Hannah xx

[raydetinu]

What was the amount paid monthly, deduct the £79 x number of months paid = ?

Deduct this and the deposit from £4652.50, that is what you have to pay to reach the 50% figure.

[Mollymoo11]

I paid £79 a month for the insurances etc, in total a £270.77 a month for that and the car for 27 months?

[crem]

I dont think i can go after them as i did sign to have the PPI and extras, i was told i should have them so i stupidly did.

 

Hannah xx

 

This would qualify as mis-selling if it turns out, for example, that because you are selfemployed, you couldn't have claimed against the PPI. Just coz you signed for it doesn't mean it wasn't mis-sold to you in the first place.

[raydetinu]

that would appear to be £5177.70 > £4652.50 for the car so you should not have to pay anything more.

just noticed you say 29 months in post 8?

suggst they whistle for the rest as you dont need it now. Why should you continue to pay something you dont and they will have no liability for, risk has ended.

I would claim the PPI back anyway, up to them to defend it now.

[Mollymoo11]

oh dear...i am SOOO confused and worried now!

 

Welcome just phoned me saying that i have to pay that money as when i signed for it it meant i was actually buying the payment protection and Breakdown insurance so i have to continue to pay it off

[crem]

As has been suggested, you should pursue the "mis-selling" of the PPI in which case you not only won't have to pay any more, but you will also get all monies paid for the PPI so far back. CLearly you didn't choose to purchase the PPI and appear to have been mis-lead into thinking you HAD to take the PPI as part of the deal.

[raydetinu]

Write back saying you want to claim your PPI back andyou want to cancel the breakdown cover and Gap insurance and ask for the cancellation costs.

you dont to carry on paying for something you dont need.

Also you may be able to claim you gap insurance back as well if it was mis sold.

See: http://www.claimbacktoday.co.uk/car-finance.php

[Mollymoo11]

Right...here we go again...

 

i have recently put in a claim to get back mis-sold PPI from Welcome Finance...

 

I have just spoke to someone from Welcome who said i have to pay back the insurance etc like they said before..if not, they will take what i owe out of the PPI money then i will get whatever is left..if any?!!?

 

IS THIS RIGHT??? i can't believe it!!!

 

now i really don't know what to do..can anyone please help? xx