Help & Advice

14 day cooling off period car finance

Hi There, i purchased a car on a whim yesterday and i have changed my mind. I can't afford to pay back the amount each month and don't want to pay back £2000 over 4 years on a £5000 loan. It doesn't seem right.

I feel really silly but what can i do as i rang the dealer today and they tried to fob me off. After doing a little research on the net i have read about a 14 day cooling off period when taking finance out on a car! Can you tell me more and whether i will get my deposit back (£500) too. Thanks, Tanya

Tanya S


Answer

Hi Tanya, apologies for the delayed response. You are indeed correct in thinking that you have 14 days to reject the hire purchase agreement. This is called the "Cooling off period" and under the Consumer Credit Directive it gives you the right to withdraw from the finance agreement.

You'll need to call the finance company asap and instruct them that you do not wish to proceed with the agreement. They can ask the supplying dealer to "un-wind" the deal and return the funds to them along with your deposit. The dealer however isn't obliged to give you your deposit back as they may well have spent time & money preparing the car for collection. The lender also can't force the dealer to return the funds if the car is in a roadworthy condition. If the dealer isn't prepared to do this you'll have to settle the finance agreement with another source of funds within the 14 days. If you believe there has been any wrong-doing by the lender or the dealer you can refer your complaint to the financial ombudsman service.

I hope this clears up the situation and if you need car finance in the future please don't hesitate to use our service by applying here. Kind Regards, Rachel

Answer correct as of September 2016

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More related questions

Hi Rachel, your advice is not completely correct.

It is not called the "cooling off period" but the Right Of Withdrawal. Advice as you have given it causes confusion and often leads to customers, like myself, thinking that they can return a vehicle if they change their mind about the vehicle.

You are also wrong in saying that deposit gets returned. The Right Of Withdrawal relates only to the balance to finance and allows customers to withdraw from the finance agreement. They have 14 days from receiving the signed (executed) agreement through the post and a further 30/31 days to pay the balance. There will be a daily rate of interest charged to the balance until it is paid. It is not a right we have to return a vehicle, which was the question from Tanya.

Answer

Hi Gillian, thank you for your question.

As you haven't yet taken delivery of the car i believe you are within your rights to call the finance company and inform them that you now don't wish to go ahead with the purchase due to the dealer taking 3 days to fix the issues with the car. Hopefully they haven't yet released the funds to the dealership. Do you have a copy of the signed finance documentation?

Just so you know we can often beat rates offered by car dealerships. If you wish please make an application when you're ready and if approved you can choose a car from any reputable dealer and we also provide a no obligation quote. Kind Regards, Rachel

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Hi, i'm hoping that you can you help me.

I purchased a car from Carcraft (west midlands) on 17 Jan 2014. I gave them a budget of £250 a month at the most and after finding a car they got back to me with a figure of £285 a month.

OK i thought fair enough and agreed to go ahead. After signing 1 agreement for the car they come back and said the finance company won't accept the deal unless i have another package for maintaining the vehicle. The total cost of which i was told after signing the agreement (an extra £67.79 per month) was £353 a month! This was over £100 a month over my budget!

I'm a homeowner with a mortgage - what can i do now? Can i get out of it? Can i sue them? Please help me, Thanks

Answer

Hi Adrian, thank you for your question.

The reference to the maintenance pack seems like a sales tactic to me. No finance company would force any optional extras on a customer.

I'd imagine with a few stern phone calls you could have this extra agreement cancelled. Was the 2nd agreement with the same finance company? If so ring up and explain what has happened and they should be able to un-wind this part of the agreement assuming you're happy with the original finance deal. A phone call to the general manager at the Carcraft branch in the West Midlands wouldn't do any harm either.

I don't think you'd be able to sue them as such but it would be worth taking some free legal advice should they not cancel the maintenance finance agreement. Good luck and if you need finance in the future please make an application with us. Once accepted we provide a no obligation quote and you can buy a car from any dealer. Kind Regards, Rachel

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Hi, I'm in need of some advice.

Within the last 48 hours i have taken a car on finance from Evans Halshaw with the finance provided by Santander. I also used my old car as part exchange which they valued at £200.

I have now realised i have made a huge mistake, mis-calculated my budget and realised i cannot afford the repayments. Would i be able to cancel the finance with Santander return the car to Evans Halshaw and just get my old car back?

Answer

Hi David, thank you for your question and apologies for the delayed response.

In short, you do have the right to withdraw from the credit agreement however you would still need to pay for the car (plus a small amount of interest) as you have entered into an agreement with the car dealer to purchase the car. Notice of withdrawal can be given verbally or in writing.

Your best bet may be to go back to the dealer and see if they can exchange the car for a cheaper one - you can then get the current agreement settled and take finance out on the cheaper car. I hope this helps and good luck. Kind Regards, Rachel

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Hi, I've just put a £1k deposit down on a new car, the deal is to trade in my current car which has reached the end of its 2 year finance deal and take another finance deal on the new car!

I've changed my mind as I think the payments are too high. Can I come out of this agreement? I haven't signed the agreement but did sign the order for the new car. The car is due to be delivered in 4 days. Many thanks

Answer

Hi Emma, thank you for your question.

My understanding is that if you have signed an order form it is a legally binding agreement to buy the car. However, if you haven't signed any finance documentation you haven't agreed to any repayment period as such. I'd advise to have an open and honest conversation with the dealer and see if you can come to an amicable agreement.

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Hi, I signed papers for finance for a car on Tuesday and was told I could collect the car later on that night.

However, due to the car needing work done, I still don't have a date to pick up the car three days later. I have seen a better car that would suit me and was wondering if I could cancel the finance as i have not got the new car yet! Thanks

Answer

Hi Gillian, thank you for your question.

As you haven't yet taken delivery of the car i believe you are within your rights to call the finance company and inform them that you now don't wish to go ahead with the purchase due to the dealer taking 3 days to fix the issues with the car. Hopefully they haven't yet released the funds to the dealership. Do you have a copy of the signed finance documentation?

Just so you know we can often beat rates offered by car dealerships. If you wish please make an application when you're ready and if approved you can choose a car from any reputable dealer and we also provide a no obligation quote. Kind Regards, Rachel

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Hi,

I've recently purchased (drove off the fore court yesterday) a new car. For no reason other than my own guilt at throwing £270 a month at a car, I'm looking at my options around returning the vehicle. I don't want to cancel the finance agreement if it means I have to pay the fee for the car in a lump sum. Is there any way to return the vehicle as you would any other purchased item - within a 14 days period and get a straight up cancel of the purchase?

Answer

Hi John, thank you for your question.

With your finance agreement, there is a 14 day cooling off period, so you should contact your finance provider to discuss this, and they should be able to cancel the agreement for you.

With regards to returning the vehicle, if you bought the car in person from a dealership, the likelihood is that you have already signed the vehicle order form (this is a contract to buy the vehicle), so technically the dealership is not obliged to take your car back.

Kind Regards, Rachel

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I've ordered a brand-new car through a local dealer and I have been told that the car has been assigned to me. How am I placed in just changing the model of the car at this stage? I am told that when a dealer acquires a car, they have had to pay for it so I would not be able to change it. Is that correct? Basically, I wish to change my order from a brand new Ford Fiesta to a brand new Ford focus. I have signed the order form but, as yet, no finance documents.

Answer

Hi Toria, thank you for your question.

The order form is a legal binding document, so although you have not signed any finance documents at this stage, you are still liable to pay for the vehicle. Of course the dealership may allow (at their discretion) you to swap for a Ford Focus if it has the same value, but this is not obligatory on their part at all.

Kind Regards, Rachel

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Hi,

My nephew has just purchased his 1st new car last Saturday from Bristol Street motors. His parents have put down £3500 cash deposit and the rest on finance. Drove the car home and noticed stone chippings on the paint work bonnet. Rang the garage dealer up straight away to explain they didn't want the car but they have been stalling for over a week and eventually the manager got back in touch to say they won't be giving the customer their money back! They don't want the car or to deal with the garage?

Answer

Hi Paula, thank you for your question.

Did you obtain the finance through ourselves? If so and you are still within the 14 day cooling off period, you would be able to cancel the finance deal with us.

If you have signed the order form at the dealership, however, technically the dealership isn't obliged to take the car back unfortunately.

Kind Regards, Rachel

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Rachel Wilson, Underwriting manager

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Best available rate
Total repayment
Total cost of credit

Best available rate

Total repayment

Total cost of credit

We compare products from 18 of the UK's top lenders to get you the best deal.

Hitatchi

Representative example. Excellent Credit

Borrowing £7,500 over 48 months with a representative APR of 16.8%, an annual interest rate of 16.8% and a deposit of £0.00, the amount payable would be: £211.25 a month, with a total cost of credit of £2,640 and a total amount payable of £10,140.

CarFinance 247 is a broker and not a lender