That is incorrect.
What is strange is how a £14k car with £5000 deposit leaving £9k to finance, has a settlement figure of £9800 though.
Did they explain why this was?
I can only assume it’s interest. No explanation.
We are told payment has cleared with Santander and a cheque has been issued to my daughter for the remainder.
Thanks All
They can't charge you more than you borrowed.
The only time that could happen is if you got a settlement figure before you had made the first payment and you were paying the amount borrowed and any interest accrued at that point.
You would be talking £144 added on worse case scenario, and that would be at 12% apr and them charging you the full months interest.
How many payment had she made and how much each month?
Being a PCP what was the balloon and over how many months?
Unless she took out paint protection, tyre insurance etc. etc. and has kept that quiet, something doesn't add up.
She should have had at least £1450 back to her.
When I commented I just took the OP’s numbers without little thought, but thinking afterwards I do agree that they seem a little odd but I didn’t follow up.
The OP has said two things about finances
i) price of car was £14,000
ii) final payment is £9,800
I took final payment to mean the balloon payment, pay and keep the car, or hand the car back and walk away.
But I agree, that thinking about it, that seems rather high for a £14k car.Assuming there was an initial contribution that would leave very little to be financed.
I wonder whether what the OP means is that Santander are expecting a total of £9,800 back - which would include the balloon, outstanding finance capital repayments and whatever interest can be claimed under the T&Cs.
So the OP is saying that Santander want £9,800 to wipe the slate clean and suggesting that the insurance offer is £10,600 but that will be paid direct to Santander and he won’t get the excess £800.
Not sure if what he is suggesting about Santander hanging onto the extra £800 is well-founded but I think that is the gist of what he is saying.
Cheers,
Nigel
Perhaps it is a case of vehicle was £14K but cost plus finance is north of that. Then take the deposit off that figure and considering it was sadly a relatively recent purchase thus few payments made, hence the settlement figure.
Just guessing whilst looking on my phone data:image/gif;base64,R0lGODlhAQABAIAAAAAAAP///yH5BAEAAAAALAAAAAABAAEAAAIBRAA7
In a roundabout way you are correct except Insurance have given my daughter the remainder £740 and also personal belongings up to £300. So she will be left with £1040 from the claim.
Nigel, as you say and I understand is that Santander want £9800 and that includes all costs of all final payments, balloon payments and outstanding financial costs. PCP is now closed and finalised.
Carl
As asked before about how many payments made, only two payments made.
Carl
The car was £14k.
£5k deposit was paid.
That is £9000 to fund.
I would guess £300 had been paid off the capitol if two payments made, £150 in capitol and around £130 interest, but that is just a guess.
Say it was only £200 in capitol, interest stays the same of course.
But that would mean there should have been £8800 to settle the agreement.
Now, they are legally allowed to charge another months interest, which is around £140, taking it back up to £8940 or thereabouts, but no more than that.
So the question you need to ask them, and you want to see a statement, why were they asking £9800 to clear the finance when there was only £9000 financed?
To be fair, I think the insurance payout was about right, I think she paid too much for the car, and that is not their fault.
If you are paying near list for a 2 year old car then alway take out Return To Invoice Insurance for any shortfall, £5000 of cover over 48 months should be around £120 max with a 3rd party.
But I would want to know why the settlement figure is more than you borrowed.
Something doesn't add up, I'd want to see a break down of the finance. Was it even on PCP and not HP. I've seen extras like paint protection, GAP, alloy insurance etc total nearly £1500 before but we already know GAP wasn't taken out.
I like you are all frustrated by the lack of details and the fact that some parts don’t add up, I have tried to push my daughter towards challenging the insurance company and PCP Santander about the final payment and poor settlement offer she has decided enough is enough and has accepted the offer from the insurance.
Sorry all, but thanks for the advice and this has at least made her think again about PCP etc.
Carl