PCP claims are rather difficult to comprehend, particularly to beginners in car financing. But fret not, you are in a good company. For quite a number of people, the challenge comes in the form of trying to make head or tail of Personal Contract Purchase (PCP) has for most of the people. But, the good news is, you do not need a certificate in finance in order to understand PCP claims. After going through this guide, you will be well acquainted with what a PCP agreement is, your rights in a PCP agreement, and what claims may arise with respect to this agreement, if any, and how to deal with them. Legal Assist is there to extend a helping hand if and when things go wrong. Let’s get into how PCP claims work, so put on your seatbelt and let’s go for it!
What is a PCP Agreement?
At its most basic level, Personal Contract Purchase (PCP) can be defined as a car loan or leasing agreement on a car. It is quite popular since it allows for various options.
You’ve enjoyed the use of a car for a certain period of time, paid an installment on a monthly basis and after the agreement you had the option either to hand over the car, pay an amount equal to a market value of the car in addition to the monthly payments to include the car within those payments, or switch it in for a new one. Sounds easy, right? But this is where it gets funny.
How Does PCP Work?
While entering into a PCP deal you in effect are agreeing to settle the car’s further value loss. So let’s deconstruct it.
Initial Deposit:You were required to make a down payment which is in most cases about10-20% of the selling price of the car.
Monthly Payments: These payments are calculated only on the depreciation of the vehicle as opposed to calculating them on the total amount. This therefore brings the monthly figure down compared to other financial facilities.
Optional Final Payment (Balloon Payment): At the end of the term lending, you have the ability pay a large “balloon” payment and own the car, or simply return the car without making such a payment.
What Happens at the End of a PCP Agreement?
At the end of the PCP agreement, the customer normally has three options available:
Pay the Balloon Payment: Normal scenario whereby one pays the last installment where the deficit is repaid when a person wants to possess the car entirely.
Hang up the Car: No worries if you don’t want to own the car, you can just give it back. Just ensure that the vehicle is in good shape and it is within the allowed distance.
Change It: You are also free to return the current car for another one and then transfer to a new PCP for the other vehicle.
Some of the Most Common Causes of Problems with PCP Claims
Given the flexibility these agreements allow you with regard to the vehicle, they can be a bit of a double edged sword. Below are adults’ most common issues with PCP financing:
Over-mileage: If you use more than what was stated in the agreement, there are hefty penaulties.
Extra Mileage Charge: You will be charged excessively for going over and above the limit set by the agreement.
Incorrectly Sold PCP Agreements: Most of them say that they haven’t understood well, the way the PCP was structured leading to disagreements.
PCP Claim: A More Common Question Is Can You Get A Refund?
Of course! If you take out a PCP agreement but it has been mis-sold to you, then yes, you can claim a refund. This is where Legal Assist comes in. Claims of mis-selling include but are not limited to. If this sounds like your situation then you probably have a case.
Signs of PCP Mis-selling
Mis-selling of Effective or Non-Effective Products and Services – PCP Unions are also susceptible to this problem. Here are some warning signs you should be mindful of:
Inadequate Explanation of Terms: Even if the dealer was not so mistake prone, did not make a clear statement such as the balloon payment stipulation, you may have some reasons to go to court.
High-Interest Rates Not Disclosed: Interest was a factor but it was not mentioned at all, nor even how much you would shell out in the end to ascertain that it’s not a german discount. That in a nutshell, is mis-selling.
Misleading Promises About Mileage: when the dealer was informed that mileage will not be a problem and now you are charged extra for mileage for exceeding the limit, you may have been mis-sold.
How to Make a PCP Claim?
One would assume that making a PCP claim is a complex process while it is far from the truth. Here’s a step by step procedure.
Gather Your Documents: This consists of your contract, particulars of payments made to date and all communications with the dealer or with the finance house.
Review the Terms: Ensure that you have effective comprehension of the provisions of the contract you entered into and the areas which you think the mis-selling took place.
Contact the Dealer or Finance Provider: Address your issues to them. In some instances, this may help avert further actions.
Seek Legal Assistance: If you are not happy with the response given to you this where Legal Assist comes in. We are proficient in PCP claims management and would help you proceed in the legal aspect.
Why Legal Assist?
Dealing with lawyers in any situation where a claim is made for a PCP can be tedious but necessary. This is why Legal Assist has put in place strategies to ease this burden. With experience helping clients win back lost funds as a result of malpractice, we simplify the process. We will review your situation and let you know the best way to proceed, and if needed, we can represent you in discussions or court. And the best part? There is no payment if you lose your case, no win no fee –contractor!
How Long Do PCP Claims Take?
In some instances, the duration of a PCP claim will vary. Some claims can be dealt with in a short span of time, mostly in months where clear evidence is available. Nonetheless, some complicated claims can run into a year, and more before resolution is achieved. Of course, you will need some patience with this one, but you can be sure that Legal Assist will always have you in the loop every step of the way.
The Function of the Financial Ombudsman in regard to Disputes on PCP claims
The matters of PCP claims may therefore be brought to the Financial Ombudsman Service if they are not particularly useful or needed. Since it would be difficult to resolve the issue, the role of the Ombudsman is to serve as a mediator between the consumer and service providers. However, this should be the last action one take after engaging the finance company and they refuse to cooperate.
What is the amount of compensation that is usually offered
The compensation amount that you can lay claim on all depends on the particulars in your case. Ideally, if a PCP contract was inappropriately sold to you, there is the likelihood that you can reclaim any overcharges that were made in additional fees or even all the payments made. There is the provision for calculating what lawyers will collect traits of compensation depending on the circumstances of the individuals.
What if The Balloon Payment is Not Possible
Most people go into panic mode for instance when it comes to balloon payments which is ideally the overwhelming charges at the end of a PCP deal. But don’t worry—there are options. You can forfeit the balloon payment and surrender the car, or in some cases, you can renegotiate the amount you owe. Legally Assist can help you move pleasantly against this negative twist.
Your Rights Under PCP Agreements
When it comes to entering into a financial agreement like that of a PCP, recall as a consumer that you have certain rights. They are:
Right to Full Disclosure: The complete breakdown of costs and other terms should be highlighted beforehand.
Cooling-Off Period: This is a 14-day time slot given to you within which you can cancel the agreement without penalties.
Fair Treatment: Do not forget that the dealer and finance company must treat you fairly.
How to Avoid PCP Pitfalls in the Future
The easiest means of fending off any PCP related headaches in the future is by ensuring that you read and understand the terms of the agreement before committing yourself to signing anything. Some of these are as follows:
Always Ask Questions: Always remember that you have the right to understand everything presented before you.
Know Your Mileage: Be candid on how much you will be driving to minimize excess mileage fees.
Read the Fine Print: While it may be dull, it is advisable to take your time reading the terms and conditions in order to prevent complications in the future.
Conclusion
Considering and financing a car by way of PCP agreements has its advantages, but these options also have their disadvantages. Whether it is due to the excessive mileage-based charges or undue wear and tear – if you are of the opinion that the PCP deal was mis-sold to you, it is perfectly acceptable to get help. Legal Assist is here to get to the bottom of the situation and in case you are entitled to any money get it back to you. So, when in doubt about your PCP claim, you don’t have to struggle with your thoughts, just contact us.
FAQs
Is it possible to terminate the PCP agreement before its term?
Yes, it is possible to preclude the PCP deal, though there may be certain pre-estimated fees. It is prudent to go over the terms of the agreement or just ask Legal Assist for their opinion.
What do I have to expect in terms of mileage?
In case you go further than what was agreed upon, there will be an additional charge for every mile which has exceeded what was specified in the contract. You just know that these costs are based at some rate and if you keep exceeding your mileage this rate may spiral.
Can I incur expenses for the car damages?
Sure, in the case of other car damage apart from normal wear and tear, when the car is returned after the hire period out all costs of repair will be on you.
Is there any way to speak with you about the balloon payment?
In some situations, a balloon payment can be negotiated or refinanced. Legal Assist can help you with that.
How do I authorize a joke from you and not have to worry with a police on any mischief that’s done by you?
If you suspect that you were missold your PCP deal and the sales terms weren’t clear or there were misleading information on key issues such as the interest rates, then this probably was a mis-selling of your PCP deal. Let Legal Assist handle your case for a better understanding.
