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  1. #1
    Dlaverty's Avatar

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    Default CLS car finance please help

    hi there so I have decided to voluntarily terminate my car finance contract as I no longer can afford it. I have had the car for a year , in arrears of one month and have 2511.22 to pay to reach the 50% I’m liable for. I have offered to pay that in reasonable monthly payments and asked them if they could contact me within next 14 days to collect the car.

    I hace used templates to email the company and I’ve just received this

    If you are looking to Voluntary Terminate the contract you must do the following
    - Pay the arrears of £219.19 immediately
    - Return the vehicle to the branch that you purchased it from before 20.12.17

    can someone offer some advice please. The branch is over two hours away from my home

    thank you
    Last edited by Kati; 6th December 2017 at 11:36:AM.

  2. #2
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    Default Re: CLS car finance please help

    tagging @R0b (he's good at this ) xx
    Debt is like any other trap, easy enough to get into, but hard enough to get out of.

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  3. #3
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    Default Re: CLS car finance please help

    Thank you xx

  4. #4
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    Default Re: CLS car finance please help

    Just wondering if there is any advice in regards to having to pay the one month arrears and delivering the car please x

  5. #5
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    Default Re: CLS car finance please help

    Hello

    The arrears is not a bar to giving notice to VT. Section 99 of the CCA says:

    At any time before the final payment by the debtor under a regulated hire-purchase or regulated conditional sale agreement falls due, the debtor shall be entitled to terminate the agreement by giving notice to any person entitled or authorised to receive the sums payable under the agreement.

    There is nothing in the above statement that says you need to pay arrears before you can VT. Your liability will be limited to 50% of the total amount under the agreement so you would take the one months' arrears and then add the remaining difference to make up the 50%.

    As for returning the car, well you are under no obligation to do so but for the sake of arguments you might want to do that, or they may try to charge you for collection (which is not enforceable). This might be useful if you live close to the delivery site, otherwise you can refuse and ask them to collect it themselves.




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    Default Re: CLS car finance please help

    Thank you for your reply ! So I can reply stating that i continue with my stance of VT and know that arrears are not a bar from me doing so? The branch is 2.5hours away from my home and I’m on my own with young children so it isn’t the easiest to return the car

    thank you again. I’m trying to deal with this myself and in the best way possible

  7. #7
    R0b's Avatar

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    Default Re: CLS car finance please help

    http://www.legalbeagles.info/forums/...tter-Templates

    The link above is an example of templates you may adapt to suit your situation
    DISCLAIMER: ANY CONTENT I POST IS INTENDED FOR EDUCATIONAL AND INFORMATIONAL PURPOSES ONLY AND IS NOT A REPLACEMENT OR SUBSTITUTION FOR LEGAL ADVICE. I MAKE NO REPRESENTATIONS AS TO THE ACCURACY OF MY POSTS NOR DO I ASSUME ANY RESPONSIBILITY. USE OF ANY CONTENT IS SOLELY AT YOUR OWN RISK AND COST AND I ACCEPT NO LIABILITY. YOU SHOULD SEEK INDEPENDENT LEGAL ADVICE BY GOING TO Law Society's Find A Solicitor OR CONTACT YOUR LOCAL Citizen's Advice Bureau.


  8. #8
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    Default Re: CLS car finance please help

    I’ve just received this reply. Can you please advise ?


    We refer you to section 99(2) of the Consumer Credit Act 1974 which states:

    (2) Termination of an agreement under subsection (1) does not affect any liability under the agreement which has accrued before the termination.

    We then refer you to page 2 of the Credit Agreement which states:

    Termination and Repossession
    You may terminate this agreement at any time before the final payment is due, by giving us written notice at the address shown under Right of Withdrawal above. You must then immediately pay us the amount by which one half of the Total Amount Payable exceeds the sums paid and the sums due in respect of the Total Amount Payable immediately before termination.

    We cannot agree that you are entitled to terminate the agreement as it currently stands. The Consumer Credit Act does not state you are entitled to terminate without having paid the liability due under the agreement, and we contend that it is incorrect of you to interpret it as such. In addition to this, the binding contractual terms and conditions of the Credit Agreement do explicitly state the payment is required at the time of termination.

    For clarity, upon full payment of the termination liability (including arrears), you will then be entitled to exercise your right to terminate the agreement under s99. However, the vehicle must be returned to us at your own expense, and be in full working order with a current MOT certificate

  9. #9
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    Default Re: CLS car finance please help

    Errr yes it does, section 99 says:

    At any time before the final payment by the debtor under a regulated hire-purchase or regulated conditional sale agreement falls due, the debtor shall be entitled to terminate the agreement by giving notice to any person entitled or authorised to receive the sums payable under the agreement.
    Where in the above paragraph does it say that you have to pay any outstanding arrears before you can terminate? This right is indefeasible and cannot be overruled so anything that contradicts this position is void and unenforceable. In fact, the wording of the clause they've mentioned also says you can terminate first and then pay after. You are not disputing that you don't owe the money but there is nothing which suggests you must pay first, terminate second - it's the other way around.

    I'd be inclined to put in a formal complaint about this and see what final response you get back.

    It is really annoying that lenders make it so difficult for you to VT. If you can't terminate before you pay the arrears then you could effectively owe more arrears and thats not what it was intended to do.
    DISCLAIMER: ANY CONTENT I POST IS INTENDED FOR EDUCATIONAL AND INFORMATIONAL PURPOSES ONLY AND IS NOT A REPLACEMENT OR SUBSTITUTION FOR LEGAL ADVICE. I MAKE NO REPRESENTATIONS AS TO THE ACCURACY OF MY POSTS NOR DO I ASSUME ANY RESPONSIBILITY. USE OF ANY CONTENT IS SOLELY AT YOUR OWN RISK AND COST AND I ACCEPT NO LIABILITY. YOU SHOULD SEEK INDEPENDENT LEGAL ADVICE BY GOING TO Law Society's Find A Solicitor OR CONTACT YOUR LOCAL Citizen's Advice Bureau.


  10. #10
    Dlaverty's Avatar

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    Default Re: CLS car finance please help

    Thank you so much. I’m finding the whole process very stressful and they are not making it any easier!! Will update when I get a reply. Thank you again.

  11. #11
    Dlaverty's Avatar

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    Default Re: CLS car finance please help

    Thank you so much. I’m finding the whole process very stressful and they are not making it any easier!! Will update when I get a reply. Thank you again.

  12. #12
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    Default Re: CLS car finance please help

    So here is their response ����



    We do not dispute that the Consumer Credit Act 1974 s99(1) gives provision for you to terminate at any time. However, it does not give provision to do so without paying the liability.

    We refer you to s100(1) of the Consumer Credit Act 1974 which states:

    (1)Where a regulated hire-purchase or regulated conditional sale agreement is terminated under section 99 the debtor shall be liable, unless the agreement provides for a smaller payment, or does not provide for any payment, to pay to the creditor the amount (if any) by which one-half of the total price exceeds the aggregate of the sums paid and the sums due in respect of the total price immediately before the termination.

    We consider that your failure to MOT the vehicle when due may constitute a failure to take reasonable care of the goods. Under s100(4) this may increase the liability due by an amount equal to the reduction in value of the vehicle. Should, for example, the vehicle require such remedial work that would render repair uneconomical, this increase may be significant. (Failed it’s mot in October due to a fault that was reported TWICE to the company within warranty period and was never fixed. I decided to SORN it)

    We therefore contend that your demands are unreasonable in their current form, and so in an effort to come to a suitable resolution, we are prepared to accept the following:

    1. You return the vehicle to us under s99(1). Should you require collection, we can arrange this at an upfront cost of £150.00. You purchased the vehicle at Edinburgh Car Finance, and so it cannot be considered an unreasonable distance. (Over 2.5 hours away)
    2. You pay the arrears immediately.
    3. We agree to accept payment on a monthly basis at the contractual rate of £219.73 on 21st of every month until you have paid the termination liability, plus any increase due under s100(a). The next contractual payment is due 21/12/17. (The whole point of me terminating is that I can not afford these payments)
    4. You acknowledge that you are not entitled to a reduced payment arrangement just because you have terminated the agreement. Should you wish us to review an arrangement, you agree to complete and return the Common Financial Statement with supporting documentation immediately.

    We have recorded this as a complaint and this is our final response. We consider the above offer to be both fair and reasonable in the circumstances. You are entitled to refer the matter to the Financial Ombudsman Service anytime within the 6 months of this email.
    Last edited by Kati; 11th December 2017 at 12:50:PM.

  13. #13
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    Default Re: CLS car finance please help

    Just wondering if anyone could please advise?

    Do i I reply to this or just go to the financial ombudsman , the stress is taking its toll

  14. #14
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    Default Re: CLS car finance please help

    It would be helpful if you could post up what you actually send them before I can respond - just to clarify CLS is the finance company who loaned you the money e.g. CLS Finance Ltd?
    DISCLAIMER: ANY CONTENT I POST IS INTENDED FOR EDUCATIONAL AND INFORMATIONAL PURPOSES ONLY AND IS NOT A REPLACEMENT OR SUBSTITUTION FOR LEGAL ADVICE. I MAKE NO REPRESENTATIONS AS TO THE ACCURACY OF MY POSTS NOR DO I ASSUME ANY RESPONSIBILITY. USE OF ANY CONTENT IS SOLELY AT YOUR OWN RISK AND COST AND I ACCEPT NO LIABILITY. YOU SHOULD SEEK INDEPENDENT LEGAL ADVICE BY GOING TO Law Society's Find A Solicitor OR CONTACT YOUR LOCAL Citizen's Advice Bureau.


  15. #15
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    Default Re: CLS car finance please help

    Yes cls are the finance company

    this is what I had sent them :

    Sir/Madam

    I refer again to the CCA which explicitly states I can terminate at any time before a final payment is due thus making my termination from 5/12/17 correct. This right cannot be overruled:


    At any time before the final payment by the debtor under a regulated hire-purchase or regulated conditional sale agreement falls due, the debtor shall be entitled to terminate the agreement by giving notice to any person entitled or authorised to receive the sums payable under the agreement.


    The terms of the contract does not prevail over the CCA. If there is a term which is inconsistent with the CCA then it shall be deemed void - this is explained in s.173 of the CCA.


    I am not disputing the payments owed to yourselves and I have on more than one occasion offered a reasonable affordable monthly amount arrangement.

    May I remind you that as an authorised firm, you have certain legal obligations under the FCA rules and any breach of such rules, shall be reported to the FCA and an official complaint made to the Financial Ombudsman.

    I have suggested on a number of times that the vehicle is available for collection yet I am at a loss as to why you are refusing to pick up the vehicle. You have had ample time to arrange a suitable collection and it appears that your behaviour or reasons for declining to collect the vehicle is unwarranted. I ask again if you could contact myself on to arrange the collection of the vehicle. I will also be notifying the DVLA in due course that liabilities will be with yourselves.

    I would now like to make a formal complaint to yourselves and look forward to your reply. I will also be contacting the financial ombudsman
    Last edited by Dlaverty; 11th December 2017 at 12:35:PM. Reason: deleting phone number

  16. #16
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    Default Re: CLS car finance please help

    I would remove your personal number from your post, this is a public forum.

    In short, their response appears to acknowledge that you have the right to terminate at any time and in turn must therefore accept that having given your notice to terminate the agreement terminated with immediate effect, whether by email or upon receipt of the letter according to normal postal rules.

    Their reply to section 100(1) is irrelevant, as I don't think you are disputing the fact that there is an outstanding amount to pay, but the manner and how much should be paid. They mentioned the next contractual payment but the agreement is terminated so you are not obliged to make a payment on 21 December rather you need to come to an arrangement to repay the difference required. Was this the date on which you made your monthly instalments? I can't see how they can agree unilaterally that payment must be made on this date if you didn't agree to it in the first place, unless you did agree. Section 100(1) simply what you are liable for but it doesn't mean that it must be paid immediately before termination of the agreement can be effected or accepted by CLS.

    The other point is that they are regulated by the FCA and therefore have to comply with certain rules with consumers. The FCA CONC Handbook says that (CONC 7 - Arrears, default and recovery), lenders must have due regard to its obligations to treat customers fairly when they are in arrears (7.3.2), must treat customers with forebearance and due consideration when in difficults with arrears/debt (7.3.4), should allow the customer a reasonable amount of time to repay the debt (7.3.6) and more importantly, not to pressurise a customer to repay a debt in one single amount or very few amounts where those amounts are unreasonable large and/or would have an adverse impact on the customer's financial situation (7.3.10).

    The references to all of the above can be found here -> https://www.handbook.fca.org.uk/handbook/CONC/7/3.html

    There might be more but you will see on that link there is reference to an "R" and a "G". Reference to "R" is a rule and therefore a legal obligation whereas a "G" is guidance which is not an obligation but gives an example as to how lenders should comply. Arguably if they are in breach of any of the rules, that could give rise to an unfair relationship.

    You can complain to the FOS if you want, but perhaps it might be worth writing back to CLS and pointing out these failures and addressing the points they have raised with what you have commented on. Offer them the opportunity to reconsider their decision but if they insist then you will go to the FOS and also seek compensation for the difficulties and obstructions that CLS have put up when you tried to exercise your right to VT.

    There's probably some more things I've missed off but thats a starting point and if you want to post up a draft response, happy to look over it and give feedback before you send it off.
    DISCLAIMER: ANY CONTENT I POST IS INTENDED FOR EDUCATIONAL AND INFORMATIONAL PURPOSES ONLY AND IS NOT A REPLACEMENT OR SUBSTITUTION FOR LEGAL ADVICE. I MAKE NO REPRESENTATIONS AS TO THE ACCURACY OF MY POSTS NOR DO I ASSUME ANY RESPONSIBILITY. USE OF ANY CONTENT IS SOLELY AT YOUR OWN RISK AND COST AND I ACCEPT NO LIABILITY. YOU SHOULD SEEK INDEPENDENT LEGAL ADVICE BY GOING TO Law Society's Find A Solicitor OR CONTACT YOUR LOCAL Citizen's Advice Bureau.


  17. #17
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    Default Re: CLS car finance please help

    I honestly cannot thank you enough for all of your help. This has been a stressful decision to come to with two young children and not being in the middle of our town so this has just all added to it!

  18. #18
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    Default Re: CLS car finance please help

    Finally have a response. I’m finding this so draining and stressful


    Mxx xxxxxxxx

    We do not agree that we have acted unfairly in any way.

    It seems we are going around in circles and as you have had our final response, you are entitled to refer this to the Financial Ombudsman Service for investigation and adjudication.

    Your assertion that we have not upheld CONC 7 is wholly disputed. We refer you to our previous 2 emails which address the issues clearly. We have requested a submission of a Common Financial Statement from you, which it appears you are refusing to provide us with. We are unable to help people who refuse to assist us in fact finding.

    The Notice of Default issued on 28/11/17 requires a payment of £219.19 arrears before 17th December. Should this remain unpaid then we will have no other option but to proceed with a repossession of the vehicle for the default.

    We find your selective application of the Consumer Credit Act rather bemusing. You are mistaken at best. Clearly you are receiving advice from someone with knowledge of the Act and CONC. However, we suggest you seek a qualified second opinion as a matter of urgency.

    Again, for absolute clarity, you have been given our final response on 8th December 2017. Please refer this to the Financial Ombudsman Service for adjudication as you have continually threatened. It is something we are entirely comfortable with.

    We will now hold the account to the 18/12/17 and review for repossession should the arrears not be paid.

    Regards

    Colin Long
    CLS Finance
    Last edited by Kati; 14th December 2017 at 13:17:PM.

  19. #19
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    Default Re: CLS car finance please help

    Hello,

    You are more than welcome to go to the Ombudsman and complain to them about this should you wish. If they have given you a budget sheet but you have refused then that's up to you, but of course you can always partially complete the information if some of the questions being asked are too intrusive which would make you look more reasonable than point blank refusing.

    Equally, Mr Long is entitled to his own opinion but it seems that he is misguided in his approach and I am not sure why he finds it rather 'bemusing' and 'selective' in the application of the CCA. Sections 99 and 100 govern the right to VT and your liability upon doing so, it is a unilateral right and irrespective of whether a default notice has been issued - as long as the agreement remains alive, you can still VT and avoid paying the whole balance rather you will have to pay the outstanding arrears plus the rest of the balance to make up the 50%. Once terminated, the date specified on the default notice to remedy the issue becomes redundant for the reason that you terminated before they had the chance to.

    As for the supposed repossession of the car, that can only be a good thing since you want rid of it anyway but doesn't affect your limited liability under section 100.

    You need to decide, what are you going to do?
    DISCLAIMER: ANY CONTENT I POST IS INTENDED FOR EDUCATIONAL AND INFORMATIONAL PURPOSES ONLY AND IS NOT A REPLACEMENT OR SUBSTITUTION FOR LEGAL ADVICE. I MAKE NO REPRESENTATIONS AS TO THE ACCURACY OF MY POSTS NOR DO I ASSUME ANY RESPONSIBILITY. USE OF ANY CONTENT IS SOLELY AT YOUR OWN RISK AND COST AND I ACCEPT NO LIABILITY. YOU SHOULD SEEK INDEPENDENT LEGAL ADVICE BY GOING TO Law Society's Find A Solicitor OR CONTACT YOUR LOCAL Citizen's Advice Bureau.


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