Returning a car - contract issues

[faxfan]

Hey All,

Interested peoples views on this -

Had a car and due to financial reasons need to return it. So I called the company and asked how it worked returning the car. I got the following explanation -

The settlement figure is £23,000 and you surrender the car, we will auction the car and if there is an outstanding balance you will owe this. Checking the auction sites etc. the value was £30,000.

So all good, I fill in the forms arranged the surrender and the car was picked up.

I also received a letter confirming the settlement figure and that the car would be auctioned.

A few weeks later I receive a letter from a solicitor saying I owe £5144. I check with the company and apparently the actual contract for returning is to pay 90% of the remaining payments of the car. This is written into the signed contract.

I obviously complain, get them to check call records etc.

The company agree that I was indeed told the wrong thing by them and they are sorry and offer £200 compensation. BUT I still owe them £5144 as per the written contract.

Pay up? Offer a compromise? fight it?

To me I've gone from owing nothing, to owing £5144. I based on decision on what they told me. Of course I should have checked the contract but you'd reasonably expect the company to tell you the right thing?

But it is unlikely it sold for 30k at an auction. Have you asked how they calculated the balance due?

I’d be asking for a full financial breakdown, then head to citizens advice, trading standards and the financial conduct authority / financial ombudsman

The balance due is 90% of the remaining payments, according to the company the settlement figure and auction value have no relevance and are not taken into account.

Then take all your paperwork to cab to review it.

The company agree that I was indeed told the wrong thing by them and they are sorry and offer £200 compensation. BUT I still owe them £5144 as per the written contract

That's great that they have admitted their mistake. Refuse the compensation, tell them you made the decision because of the incorrect information they gave and suggest you both call it quits. ( you pay nothing and they pay nothing) if they don't agree, ask for a recording of the call then ask for a deadlock letter then go to the car finance ombudsmen.

I think that's right but maybe check with Citizens advice.

BTW - have they given you an explanation of where the excess £5k comes from. Could it be excess mileage and damage or is all finance.

The auction value is irrelevant. The settlement figure is relevant, but it seems they calculated it incorrectly. Based on what you have posted, the settlement figure should have been 90% of the remaining payments.

From a legal perspective, if they have now calculated the settlement figure correctly, that is what you must pay. However, given this was their mistake, you should insist on being given time to pay and point out that you will seek further compensation if your credit rating is affected by their mistake.