Unable to stop PCP balloon payment?

[Carfinancehelp]

Hi,

We have had a PCP agreement on our car which was due to end at the end of this month. Some weeks ago my husband spoke with the lenders and agreed to enter a new PCP agreement for another few years after which time we will own the car. He says he was assured over the phone that it was all sorted.

However it appears they subsequently sent through documents to sign via their online portal for this new agreement, which my husband overlooked.

As a result he received a call yesterday saying that as they weren't signed they will now take the balloon payment (~£5k) for the car on 1st October, which we do not have the funds for. They have said as it is within 5 working days of the payment being due to be taken they cannot stop it and we will have to wait for it to bounce and then set up this new PCP agreement which will come into play in November.

Does it seem true that a company can't cancel a direct debit payment within 5 working days before it is due? I am well aware my husband was in the wrong for overlooking the communications but just wondering.

Yes it’s true

They will have already created / sent the DD files at this point so no they can’t stop it, you can just cancel the direct debit your end though if you dont want to incur bank charges?

Ah okay. My husband has spoken to our bank and I believe they have cancelled the original direct debit from the company and put some kind of note on our account about the payment due so I am hoping this means the payment is effectively stopped on our end before it bounces but I am feeling very anxious about it all.

It can't be stopped from the finance company's end, so it will attempt to take the payment and it will bounce. It will show them that you cancelled it at your bank's end. You will be able to see it on your statement.

I've no idea about the finance but make sure you get something sorted else they will come after you for the full payment.