Hi there
I just joined this forum today and this is my first post so I hope you guys can offer me some help.
Background story is this, I have a Toyota Avensis on a 3 year personal contract hire from Toyota Financial Services that I use solely for my job and all was going swimmingly as the £471.72 per month that I pay Toyota for the vehicle was being nicely balanced by the car allowance that I recieved from my employer. I am 10 months into this contract. At the end of the term, I simply give the car back and there are no further payments to be made. In this deal, if I continue the lease after 3 years, I get a new Toyota and I have no options for buying the car after the lease ends.
So all is well and good and then at the end of November, I got made redundant from my employment. Company was taken over by large PLC and although I am good at my job, I am excess to requirements and so given the boot.
Now my situation is that I have a car, 10 months into a 3 year contract and having put my situation to Toyota, all they have offered me is a buy out of the contract at 6.8K and they take the car back off me!!!
I cant afford to keep the car, its too expensive, I cant accept a job unless it offers a car allowance and they seem thin on the ground.
Please, someone, offer me either a technical loophole to get out of this or some good advice whereby if I have to keep this car, I at least get to own it at some point!!!
Thanks in advance new friends!!!
Mike
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I think you're stuck with it. You signed a 3 year deal, so a 3 year deal it is.
They would normally offer some sort of insurance policy to cover this sort of situation, but I guess you didn't take this option. Sorry.
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speak to a solicitor i would say who is conversant with lease contracts motor related,see what he has to say £50 for half an hour is far superior to any citizens advice bureau,i went there years ago with a similar problem and they gave very bad advise so went to a commercial solicitor and he steered me right.
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The deal you have is a personal contract between you and the HP /Finance company. You are saying there was no involvement of your previous employer and the Finance Company. From what you say you did not insure your monthly paymenst for sickness /redundancy etc
Well there is no way out as you took on a 3 year commitment @ £471 / mth and you are stuck with the £471 / mth unless you buy it out by paying the HP co nearly £7K and they take back the car.
In a previous job there was a tie up of the employer and the Finance Co and for a figure (£5.00/ mth springs to mind) there was a "get out of jail card" - i.e. if you left or were made redundant the car went back with no charges (except if the car was damaged, scuffs/scrapes etc).
In reading your circumstances as outlined I would suggest you have no choice other than to continue paying the HP Co.
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I'm sure I've come across a website where people advertise their lease cars and get someone else to take on the remaining contract, but the address escapes me. However, a Toyota Avensis @ £471pcm doesn't look particularly attractive I'm afraid.
Although it will do your credit rating no good at all, if there is absolutely no way you can afford the payments one option would be to default on the payments and let them snatch it back. I would discuss the implications of this course of action with a solicitor first.
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why not sell it???? pay off what u can and just have a couple of thousand owing...
if u pay off the loan early,,do u get a settlement figure???
altho there are implications...like hpi left on the car..why not goto a garage and see if they will buy it....
i once got offered 11k for a mini without even needing to px it
worth a try :)
ps..typical of a large company to lay ppl off near to xmas....
i guess they only made 300 million profit last yr????
--
www.storme.co.uk
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An unfortunate situation. I can't help much other than to say that £471 sounds very dear for an Avensis - was there a high mileage allowance built into this (i.e. 30k miles a year?). Obviously you will be doing a lot less than this, so could you renegotiate that bit of the contract?
Also, do you really need a new job with a mileage allowance - surely one that pays 'enough' would do?
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Yes there is a company who specialise in transfering contracts, you may be well off speaking to them and seeing what they have to say. www.transfercontracts.co.uk/
If you took the contract out only 10 months ago then in theory as part of the new FSA regulations the person who signed you up would of offered you a variety of insurance packages such as redundancy cover. You should have signed something to say that you were offered it but turned it down therefore they have covered themselves and so if you try to get out of the contract you won't have much joy.
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Doesn't help you but this is the bit that companies ignore when they push employees to opt out. Adding sickness / redundancy / resignation insurance (which you have by default if you have a company car) adds around £100/mth to most contracts and takes away a lot of the financial benefit of opting out.
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The problem here is that a PCP consists of basically linear payments over the period but the depreciation of the car is not linear: most of it happens in the first year so PCP's are very expensive things to terminate early.
I can only echo the suggestions of other posters who suggest trying to find a transfer or a buyout. The reality is though that the car has probably depreciated significantly more than you have thus far paid off so in all events you will probably have an unpleasant financial hit.
PCP's are OK but they are real "lock-ins".
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Hi Blue Haddock
Thats very good info thanks and also very interesting.
I have to say that as part of the sign up process, I was not offered any payment protection and it was not until a while afterwards that I learnty of this type of cover.
I still never signed up to it but what I am interested in here is the fact that if I was not offered this form of insurance and can prove the fact, do I have a loophole to get me out???
Cheers
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I'm suprised the dealer didn't offer you anything like this as they are nice profit centres for the dealer. It came into force around January 15th 2005 when the FSA took over the regulation of things like payment protection. When i worked for Toyota we had to do one with every customer even if they were paying cash.
Take a look at this document - whilst it is geared up for mortgages you should of had something similar to fill in, it not only cover the dealers back to say in events like this that he did offer you such protection but also as a nice lead in to actually trying to sell you such a thing.
www.friendsprovident.co.uk/doclib/sdn.doc
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I'm suprised the dealer didn't offer you anything like this as they are nice profit centres for the dealer. It came into force around January 15th 2005 when the FSA took over the regulation of things like payment protection. When i worked for Toyota we had to do one with every customer even if they were paying cash.
I bought a 6mth old merc from MB Direct in March 05 and paid cash and I had to sign form after form to confirm I'd been offered but had refused all sorts of insurances.
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I'm suprised the dealer didn't offer you anything like this as they are nice profit centres for the dealer. It came into force around January 15th 2005 when the FSA took over the regulation of things like payment protection. When i worked for Toyota we had to do one with every customer even if they were paying cash. Take a look at this document - whilst it is geared up for mortgages you should of had something similar to fill in, it not only cover the dealers back to say in events like this that he did offer you such protection but also as a nice lead in to actually trying to sell you such a thing. www.friendsprovident.co.uk/doclib/sdn.doc
Daughter bought a new Yaris(for cash) in April this year and had to sign disclaimers for insurance.
A question - Is this mandatory(rather than advisable) for PCP where you are not actually buying anything?
One thing is certain, either the OP or Toyota will be considerably out of pocket.
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Can't really offer any advice I'm afraid but this does sound like an astoundingly bad deal. At the end of the three years you will have shelled out nearly 17k and the car is not even yours. You can buy a brand new Avensis from about 14k list although I don't know what spec yours is.
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It certainly seems that you are tied into the contract. You need to sit down with someone and go through it with a fine tooth comb. I think that you've had good advice here. Not to certain on the FSA side of things, SWMBO isn't around at the moment to ask !
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Youre stuck with it, I'm afraid.
Finance companies long ago made their contracts water tight and car finance is from a legal point of view straightforward. You signed a lease committing to 'rent' the vehicle only and if you default they will re-posses the car then sue you for the shortfall - and that's not just on the cost of the car but ALL the outstanding (26?) payments, plus interest.
Your best bet it to try to sell the car (if you can get their permission to do so) then offer the finance company a 'commercial' settlement - they may well give you a discount on the settlement figure (less hassle for them).
Altenatively if you have no assets (house etc) default on the agreement and invite them to bankrupt you.
Next time buy outright, using a bank loan.
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Thanks for all the advice guys and it seems that I will have to try and negotiate with the financial services.
A lot of you have pointed out that it is a bad deal but the price includes all maintenance, tyres and car tax for 3 years and I also max the mileage at 30000 per year so if you put yourself in my position for a mo, when I took the agreement out 10 months ago it was purely for a company car, had no interest in owning one or the deposit to afford to own so the agreement would have suited me perfectly if it could run the full course.
We all learn people, I work in the security industry so dont ever make me look at your various house security protection and comment upon it!!!
Thanks again for the advice, someone from Toyota is calling me on the 5th!!! Will keep you posted.
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Welcome to The Backroom - said you'd get a bit more help, posting here - hope, something good comes of it!!
VB
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Hmmm. This is why I buy a second-hand car cheaply with my allowance and pocket the rest.
If the company doesn't like the idea of me driving around in a £1500 5-year-old Hyundai that's their lookout.
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