Car Finance settlement

[tinkertots]

So I understand car finance settlement figure to be 'the figure is the amount of money you need to pay to the lender in order to terminate the finance agreement before the official end of the contract.'

I had a PCP agreement with garage A, and 3 years in decided to change my car. I found one with garage B 5 hours away so bought as seen. Garage B requested a finance settlement quote from Garage A, which was generated on 7th August and sent over, and offered a price to pay off my outstanding finance and give me £2.5k on top towards a new car. All good, paid £250 deposit, and from this Garage B taxed the car and £80 would be refunded to me.

Garage B brought the car to me on Thursday (24th), so Thursday morning I went on DVLA and electronically declared I no longer owned the car.

Checked my bank today, the £80 from my deposit hasn't been refunded, and garage A has taken the usual direct debit for the car I no longer own. I went onto the finance portal for garage A and it's still live with the finance still running. Rang garage B and they said they would speak to accounts.

Emailed garage B proof of all of the above and explained that I understood the tight turnaround between handing my car to them and the finance needing to be settled with the bank holiday being yesterday, and that I assumed it to just be an error to be rectified. Garage B replied and asked for my bank details to send over the £80 from my deposit, but said the payment taken by garage A is because it they usually start to take the payment 3-4 days before it comes out of my bank, and it's for the full month.

The settlement figure was generated on 7th August. So not for the full month.

AIBU that the settlement figure will have included all outstanding monies, and that the payment taken today shouldn't have been taken, because the finance should have been settled when the car exchange took place?

Any advice appreciated!

I work in car finance.

I can only say how we do things, different finance providers may do things differently. May be worth finding out who provides the finance for the dealer.

With us, in your situation what you've said is correct. We would generate a settlement figure which will be valid for 30 days, any direct debits that go out after the settlement figure is generated will be refunded once funds received.

Thank you for your reply @Hexcodes , really appreciated! garage A finance is Vauxhall, garage B is Honda

Would it make a difference that the settlement figure was generated on 7th and ownership of old car didn't end until 23rd?

Settlement quote with Vauxhall produced on 7th was for 30 days

No that wouldn't make a difference, as long as the settlement figure is still in date it wouldn't matter if you handed the car over day 1 or day 29.

In my experience dealers can take their time paying settlements, but might be worth calling your original finance provider and check if the dd will be due back. But also so they can note that the new dealer is in possession of the car, that way if (in the unlikely event) your new dealer is late paying they are aware that it's not your fault. We would honor the original settlement figure and in really bad cases where the dealer is very late paying we contact them directly

@Hexcodes thank you so much for this, you've really helped to put my mind at ease about all this. I will call my original finance provider in the morning