Mercedes SLK - Ending PCP early

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Tue 16 Jun 2015 13:38
Mercedes SLK - Ending PCP early - csgmart

I have a PCP with Mercedes UK. The agreement allows me to end the contract early provided that at least 50% of the finance has been paid.

Having spoken to MB (to confirm this) they said that they would be obliged to put a marker on my credit record saying I had terminated the agreement early and that this "might make it difficult for me to take out finance in the future and at a higher APR and with a larger deposit".

I'm not overly bothered by this but wondered if what I was told was true or whether they were scaremongering to try and avoid me terminating the agreement early which could be expensive for them.

The SLK is now only worth £17k trade in and the outstanding finance is £22k and I'm unlikely ever to be in positive equity so don't see what the point in continuing to pay for an asset that at the end of the agreement (in 14 months time) I would need to pay £15k to own (never an option for me) and would never have a positive balance to use on a new car.

I've decided the future is bangernomics for a year or so and therefore presume that any credit marker would expire after a while anyway should I ever find myself in the market for a new car.

Thoughts please.

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Tue 16 Jun 2015 14:19
Mercedes SLK - Ending PCP early - RobJP

Pretty certain that you are correct, and they are wrong.

However, I'd suggest writing to them, explaining what you have been told, and asking them if that is correct. If it is not, then do explain that you may wish to take it to the FCA, if their staff are giving out incorrect information ...

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Tue 16 Jun 2015 15:16
Mercedes SLK - Ending PCP early - old-school-tech

I've never taken out finance on a vehicle, not with the company directly anyway, But part of me is thinking...while the outstanding finance on your vehicle outweighs the current value of it, you have had the benefit and/or pleasure of using said vehicle from the start of your ownership, and now your half way through your agreement you want out.

A bit like buying a pizza for £10, paying the pizza shop £1.00 a week for it, and 5 weeks later giving the half eaten pizza back and refusing to pay the last £5.00

Yes I know its a bit of a silly analogy, used pizza's don't sell very well etc, but thats sort of how it looks to me.

Having said all of that..It does sound to me like they are just trying to encourage you to keep the finance going, why wouldn't they.

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Tue 16 Jun 2015 15:21
Mercedes SLK - Ending PCP early - csgmart

I've never taken out finance on a vehicle, not with the company directly anyway, But part of me is thinking...while the outstanding finance on your vehicle outweighs the current value of it, you have had the benefit and/or pleasure of using said vehicle from the start of your ownership, and now your half way through your agreement you want out.

A bit like buying a pizza for £10, paying the pizza shop £1.00 a week for it, and 5 weeks later giving the half eaten pizza back and refusing to pay the last £5.00

Yes I know its a bit of a silly analogy, used pizza's don't sell very well etc, but thats sort of how it looks to me.

Having said all of that..It does sound to me like they are just trying to encourage you to keep the finance going, why wouldn't they.

Lucky you for never having to take out finance on a car - I have not found myself in this position (well, not for a new car that is).

Another way of looking at this is that I have a legal right enshrined in the agreement to do this (everyone who takes out a PCP does) and all I am doing is enforcing that right. Nothing wrong with that and whilst it may well not sit well with the finance company I am not breaking the law in any way.

The reason for wanting to 'get out' of the agreement is not so much money related - I can afford [comfortably] to carry on making the payments, but other things in my life are a priorty now (enforced by my mother falling ill and needing to go into a care home to which I have to pay an amount each month equivalent to the payments on the SLK).

Edited by csgmart on 16/06/2015 at 15:25

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Tue 16 Jun 2015 15:40
Mercedes SLK - Ending PCP early - skidpan

but other things in my life are a priorty now (enforced by my mother falling ill and needing to go into a care home to which I have to pay an amount each month equivalent to the payments on the SLK

We are in the same position, both parents now in care home but currently they are able to pay their own way. When their funds run out (which they inevitably will if they survive long enough) it will not be my responsibility to pay for them, once they have funds below the threshold it becomes the Local Authorities responsibility.

I suggest you speak to Citizens Advice, Age Concern etc. before you take over funding what the tax payer should be funding.

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Tue 16 Jun 2015 15:44
Mercedes SLK - Ending PCP early - csgmart

but other things in my life are a priorty now (enforced by my mother falling ill and needing to go into a care home to which I have to pay an amount each month equivalent to the payments on the SLK

We are in the same position, both parents now in care home but currently they are able to pay their own way. When their funds run out (which they inevitably will if they survive long enough) it will not be my responsibility to pay for them, once they have funds below the threshold it becomes the Local Authorities responsibility.

I suggest you speak to Citizens Advice, Age Concern etc. before you take over funding what the tax payer should be funding.

Mum has a flat which could be sold to fund her care but me (and my sister and brother) have chosen to rent the flat and fund the shortfall (£1,500 per month) between us. This will hopefully mean we have something to inherit that is meaningful - our choice of course, the alternative is sell up and mum uses her own money to fund her care and we inherit a smaller amount each.

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Tue 16 Jun 2015 15:47
Mercedes SLK - Ending PCP early - old-school-tech

Sounds fair enough,

Sorry If i sounded like ....well....whatever I sounded like, Didn't say it was right or wrong, Never having had finance on a vehicle I am unaware of the legal do's and dont's of the system, If you are within your rights to do this then hey, why not.

I wouldn't say I am lucky enough to never have had finance, I'm a mechanic by trade, and I have always had older cars and been lucky enough to know how to keep them on the road.

I currently drive a 1999 CLK that never lets me down, ever.

I often look at newer cars but I've got far more important things to be spending my hard earned cash on at the moment.

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Tue 16 Jun 2015 16:09
Mercedes SLK - Ending PCP early - csgmart

No offence taken.

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Tue 16 Jun 2015 17:23
Mercedes SLK - Ending PCP early - Palcouk

If You have a PCP, or any other agreement and it states in the Contract that you can terminate before the end of the agreement provided you have met any terms, then the only thing on any credit record would simply state that the agreement had been ended/finalised.

If the entry states anything else then you have course to complain, and file an explanation to the various credit agencies

You can obtain completely free credit reports from www.noddle.co.uk

Personally I wouldn't take out any PCP/Lease with MB direct haveing had them attempt to sting me with an outrageous bill when a contract I had with them ended on its due date.

Edited by Palcouk on 16/06/2015 at 17:27

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Tue 16 Jun 2015 17:42
Mercedes SLK - Ending PCP early - skidpan

Mum has a flat which could be sold to fund her care but me (and my sister and brother) have chosen to rent the flat and fund the shortfall (£1,500 per month) between us

This can be a very dangerous route to take even if you and your siblings are close and fully intend to keep to the arangement. There have been many cases reported where disagreements have arisen or one party has simply not realised until its too late how much the care would cost them over a long period. Loss of job, marriage problems etc can result in the best plans collapsing.

People who I have personal contact with have had issues recently with siblings who they thought were happy with arangements. In one case my aquaintance visits her mother daily but the home is 30 miles away. Her brother only visits once a flood. She found her mother a room in a home only a couple of miles from her own home but her brother refused her the permission to move her. Now going through the appropriate channels and causing havoc.

In the other instance a life long friend had to place her father in a home and since her 1/2 brother never visited, discussed the issue or contributed she took the unilateral decision to place him in a home close to her. He threatened legal action which caused great distress but never followed through.

I am lucky, no siblings thus can make decisions with no challange or disagreement.

Just be careful.

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Tue 16 Jun 2015 21:12
Mercedes SLK - Ending PCP early - csgmart

Mum has a flat which could be sold to fund her care but me (and my sister and brother) have chosen to rent the flat and fund the shortfall (£1,500 per month) between us

This can be a very dangerous route to take even if you and your siblings are close and fully intend to keep to the arangement. There have been many cases reported where disagreements have arisen or one party has simply not realised until its too late how much the care would cost them over a long period. Loss of job, marriage problems etc can result in the best plans collapsing.

Just be careful.

Good advice but in my case we have none of that to worry about. I have an EPA for my mother so can act [legally] on her behalf without the need to ask either of my siblings. We have agreed also to review the situation every 6 months and if any one of the 3 of us want to change the arrangement we will agree to sell the flat at that point (or the other 2 may agree to stump up the additional amount between them but on the firm understanding that when the estate does get distrubuted they will get their contributions back in full first).

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Tue 16 Jun 2015 21:37
Mercedes SLK - Ending PCP early - skidpan

I have an EPA for my mother so can act [legally] on her behalf without the need to ask either of my siblings

Trust you are aware that the EPA was replaced by a 2 part LPA (Lasting Power of Attorney) in 2007. The LPA has some advantages over the EPA and even today many banks do not understand the difference. M & D's bank (the Nat West) were insistant that I needed to get a court ruling in addition to the LPA everytime I wanted to act on their behalf (which certainly applied to the EPA in some circumstances). Took action from the Financial Ombudsman to sort it, no more Nat West accounts now.

But it sounds like you have everthing under control.

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Tue 16 Jun 2015 21:41
Mercedes SLK - Ending PCP early - csgmart

I have an EPA for my mother so can act [legally] on her behalf without the need to ask either of my siblings

Trust you are aware that the EPA was replaced by a 2 part LPA (Lasting Power of Attorney) in 2007. The LPA has some advantages over the EPA and even today many banks do not understand the difference. M & D's bank (the Nat West) were insistant that I needed to get a court ruling in addition to the LPA everytime I wanted to act on their behalf (which certainly applied to the EPA in some circumstances). Took action from the Financial Ombudsman to sort it, no more Nat West accounts now.

But it sounds like you have everthing under control.

Yes - EPA was signed by both of us in 1999 and I have been advised by my mothers solicitor that it is valid and perfectly useable without the need for an LPA. I can certainly see the risks involved and the potential for issues.

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Tue 16 Jun 2015 21:58
Mercedes SLK - Ending PCP early - Bromptonaut

If your mother is or maybe becoming incapacitated then don't forget you need to register the EPA with the Court of Protection.

As mentioned above a word with Age UK or CAB, not least for a benefits check, would be worthwhile.

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Tue 16 Jun 2015 22:06
Mercedes SLK - Ending PCP early - csgmart

If your mother is or maybe becoming incapacitated then don't forget you need to register the EPA with the Court of Protection.

As mentioned above a word with Age UK or CAB, not least for a benefits check, would be worthwhile.

Mentally she is spot on - it's her heart that is giving out...

We're pretty good on sniffing out benefits for her. We have a £110 per week contribution from the NHS and an attendance allowance of £82 per week also. She has about £17k in savings so I doubt she qualifies for more than she is getting. Her pension amounts to about £1k per month and rental income is £800 per month so she isn't too badly off compared to a lot of people.

The care home is £875 per week. It is a VERY good one - possibly the best there is in my town. We could have chosen a cheaper one (but only by £100 per week) but they are pretty shabby by comparison (smell of wee and full of agency staff etc).

Edited by csgmart on 16/06/2015 at 22:08

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Wed 17 Jun 2015 09:43
Mercedes SLK - Ending PCP early - skidpan

We're pretty good on sniffing out benefits for her. We have a £110 per week contribution from the NHS and an attendance allowance of £82 per week also. She has about £17k in savings so I doubt she qualifies for more than she is getting. Her pension amounts to about £1k per month and rental income is £800 per month so she isn't too badly off compared to a lot of people.

With under £23,000 in savings she should/might be able to get more local authority support towards her care. Suggest you speak to CAB or Age UK etc to ensure you are not missing out. In April next year the new Care Act comes into force and that should ensure you get more help since the limits are due to rise (providing the Gov does not relent on promises made in the last Parliament).

See you have already got Attendance Allowance. Its a wonderful benefit in that its not taxable and you keep it when you enter a care home. It also opnes the doors to other assistance.

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Wed 17 Jun 2015 09:55
Mercedes SLK - Ending PCP early - csgmart

We're pretty good on sniffing out benefits for her. We have a £110 per week contribution from the NHS and an attendance allowance of £82 per week also. She has about £17k in savings so I doubt she qualifies for more than she is getting. Her pension amounts to about £1k per month and rental income is £800 per month so she isn't too badly off compared to a lot of people.

With under £23,000 in savings she should/might be able to get more local authority support towards her care.

We have and they will provide funding BUT it has to be paid back after she dies, plus interest. A perfect example of why I have and always will avoid any form of assistance from the state wherever possible. My local council are just full of left wing wasters - too full of their own importance and looking for every opportunity to line their own pockets IMO.

I'd rather not let them poke their noses in and simply fund the care ourselves - it'll work out cheaper in the long run and in any event the more money we take from the state (even if we didn't have to pay it back) the more taxes have to rise etc etc. There are far more deserving cases out there than ours I can assure you.

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Wed 17 Jun 2015 11:19
Mercedes SLK - Ending PCP early - skidpan

Make sure you speak to your Local Authority to ensure any spending after April 2016 is registered against the Care Cap. Our LA is starting the process in November this year. This is proposed to be £72,000 after which all you will be required to pay will be approx £12,000 a year living expenses regardless of where you live in the country and regardless of your savings/assets.

The £72,000 is a bit missleading since this will exclude the £12,000 living expenses and it will also be capped at the Local Authority limit for your care needs.

Using £850 a week as as example that is £44,200 a year. Take off £12,000 and its £32,200. To spend £72,000 would take about 2 years 3 months before your expenses would be capped at £12,000 a year. But the Local Authority will only use the figure they would pay if you were fully funded thus the £850 could well fall substantially, lets say £650 as an example. Now it would take 3 years 4 months before you were fully funded but you would then not only have to pay £12,000 a year living expenses but also the shortfall between £850 a week and £650 a week, another £10,400 a year. That is still £22,400 a year but much lower than the £44,200 you would currently be paying.

There is a complicated formula (very complicated) to calculate any extra funding you may get but the bottom line is lifetime care costs should reduce for most people.

But there will be many disapointed people who are not aware of the £12,000 contribution and the LA figure for your needs.

Done lots of investigations recently and very few people are aware of what is happening and the way it will actually work is yet to be decided.

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Wed 17 Jun 2015 16:20
Mercedes SLK - Ending PCP early - Dwight Van Driver

Exercise caution folks with www.noddle.co.uk. Never heard of them and they want your full card details.?????????????????

dvd

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Wed 17 Jun 2015 16:34
Mercedes SLK - Ending PCP early - csgmart

Exercise caution folks with www.noddle.co.uk. Never heard of them and they want your full card details.?????????????????

dvd

They are fine. I have no connection with them whatsoever but they are owned (or have strong connections with) one of the 3 credit reference agencies. In this case Call Credit.

I know Call Credit well as we work with them regularly.

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Wed 17 Jun 2015 23:19
Mercedes SLK - Ending PCP early - alan1302

Exercise caution folks with www.noddle.co.uk. Never heard of them and they want your full card details.?????????????????

dvd

They are fine - recommended on MoneySavingExpert.

They need your card details for proof of who yo are so they can check your credit file.

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Thu 18 Jun 2015 11:45
Mercedes SLK - Ending PCP early - slkfanboy

Credit expert says pay off credit early is a good thing and there no negative impacts of early release that I can see.

Missing payments or late payments would be far worse. I would advise to take the safe option rather than the risk of missing payments

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