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Hello, 

 

we were not going to use finance to buy due to high interest rates  , however, after reading some of the posts if there are issues it appears to be helpful in getting a resolution if finance is involved in the purchase ?

 

is it prudent to pay a big deposit and leave only a little bit on finance 

 

thanks 

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What you do need to ensure is you pay part of the deposit with a credit card (£1000 or so). That constitutes finance. 

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Not sure about finance as we have never financed a van. We’re looking at buying a brand new van next year and have been advised to pay a sizeable deposit on a credit card, as that will help if we have any major issues. 

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I bought my brand new caravan with my debit card, but I had paid the initial deposit using credit card for the added protection. 
 

I think that to get the credit card protection the purchase price might have to be over something like £100, but you only need to pay £1 of that on the credit card. 
 

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One of my sons bought a van with a credit card deposit and finance, a month or two later paid off the finance with another credit card that had an initial zero interest for a specific time then reverted to interest far lower than the loan.

 

There was a small fee to pay for paying off the loan early but was insignificant in the scheme of things.

 

Six months later there were serious water leaks that the dealer attempted to repair unsuccessfully three times, this was after they broke the window in the habitation door, barn type, couldn't source a window so without a by your leave fitted a solid door which was shorter than the original one  and to make it fit raised the step.

 

Long story short, the dealer wouldn't do anything else and washed his hands of it, until the finance company got involved and slapped his legs, the price of the van was re-funded, so yes, finance if used correctly can have great benefits.

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Thanks folks very helpful 

1 hour ago, Silversurf said:

One of my sons bought a van with a credit card deposit and finance, a month or two later paid off the finance with another credit card that had an initial zero interest for a specific time then reverted to interest far lower than the loan.

 

There was a small fee to pay for paying off the loan early but was insignificant in the scheme of things.

 

Six months later there were serious water leaks that the dealer attempted to repair unsuccessfully three times, this was after they broke the window in the habitation door, barn type, couldn't source a window so without a by your leave fitted a solid door which was shorter than the original one  and to make it fit raised the step.

 

Long story short, the dealer wouldn't do anything else and washed his hands of it, until the finance company got involved and slapped his legs, the price of the van was re-funded, so yes, finance if used correctly can have great benefits.

 

 

Sorry am confused , May I ask  - If the finance company had been paid by the cc , what made them get involved as they had been paid ? 

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2 hours ago, Flatcoat888 said:

What you do need to ensure is you pay part of the deposit with a credit card (£1000 or so). That constitutes finance. 

What Flatcoat is referring to us the Section 75 of the consumer credit act. Iv used this successfully when I paid a deposit on a patio installation that went horribly wrong. Whilst I did get my money back I eventually it took almost 12 months and a 35 page dossier including inspections by 2 different companies and then the installer filing before I got my money back. The problem with Section 75 on Credit Cards is that it’s the banks giving you their own money as they are deemed jointly liable for the purchase., in essence they don’t want to pay.

 

With a direct finance like black horse, as they essentially own the van until the past payment is made it’s in their interest to get any faults sorted as such they will put a lot more pressure on a dealer to remedy any faults than any Credit Card company will and with a lot less hassle. Been there, got the T-Shirt. Black horse wins any day of the week for me put it would have to be a hired purchase style payment method.

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12 minutes ago, Pembssurfer said:

What Flatcoat is referring to us the Section 75 of the consumer credit act. Iv used this successfully when I paid a deposit on a patio installation that went horribly wrong. Whilst I did get my money back I eventually it took almost 12 months and a 35 page dossier including inspections by 2 different companies and then the installer filing before I got my money back. The problem with Section 75 on Credit Cards is that it’s the banks giving you their own money as they are deemed jointly liable for the purchase., in essence they don’t want to pay.

 

With a direct finance like black horse, as they essentially own the van until the past payment is made it’s in their interest to get any faults sorted as such they will put a lot more pressure on a dealer to remedy any faults than any Credit Card company will and with a lot less hassle. Been there, got the T-Shirt. Black horse wins any day of the week for me put it would have to be a hired purchase style payment method.

As a retired Senior Manager with what was NatWest Streamline Merchant Services (now Cardpay) I think you do the banks a disservice. The card issuer is jointly and severally liable under the CCA but the merchant/dealer/installer is given access to the Mastercard and Visa systems by what's termed a merchant acquirer who processes the transactions and passes them to the card issuer. That was the business I was in.

 

Card scheme rules control the process of who is liable and how any claim is handled with maximum timeframes for dealing with each part of the process.

 

As a cardholder you complain to your card issuer. The card issuer contacts the acquirer and basically asks for details/outlines the claim. The card acquirer is likely to contact the merchant and ask for details or a response to the claim. This process can go back and forth a couple of times. If, eventually, it's decided that, say, work was faulty, then the card issuer will make a chargeback to the acquirer and will then credit the cardholder. The acquirer will then either absorb the chargeback as a loss or pass it onto the merchant, if they still exist. The acquirer can withdraw card facilities from a merchant and for most merchants that's an important factor that can concentrate their mind.

 

Similar rules exist around fraudulent transactions, where if the card is swiped it's deemed to be a cardholder present transaction and the card issuer is liable for any fraud. If the transaction was done over the phone or internet it is deemed cardholder not present and the liability passes to the acquirer who has the relationship with the relevant merchant. If the merchant hasn't followed all the security protocols they may get charged back, but if they have, then the acquirer has to absorb the loss. Too many such losses mean the income from a merchant is less than the cost of chargebacks and, again, card facilities might be withdrawn.

I've got nothing to do on this hot afternoon

but to settle down and write you a line.

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Posted (edited)
3 hours ago, Steamdrivenandy said:

As a retired Senior Manager with what was NatWest Streamline Merchant Services (now Cardpay) I think you do the banks a disservice. The card issuer is jointly and severally liable under the CCA but the merchant/dealer/installer is given access to the Mastercard and Visa systems by what's termed a merchant acquirer who processes the transactions and passes them to the card issuer. That was the business I was in.

 

Card scheme rules control the process of who is liable and how any claim is handled with maximum timeframes for dealing with each part of the process.

 

As a cardholder you complain to your card issuer. The card issuer contacts the acquirer and basically asks for details/outlines the claim. The card acquirer is likely to contact the merchant and ask for details or a response to the claim. This process can go back and forth a couple of times. If, eventually, it's decided that, say, work was faulty, then the card issuer will make a chargeback to the acquirer and will then credit the cardholder. The acquirer will then either absorb the chargeback as a loss or pass it onto the merchant, if they still exist. The acquirer can withdraw card facilities from a merchant and for most merchants that's an important factor that can concentrate their mind.

 

Similar rules exist around fraudulent transactions, where if the card is swiped it's deemed to be a cardholder present transaction and the card issuer is liable for any fraud. If the transaction was done over the phone or internet it is deemed cardholder not present and the liability passes to the acquirer who has the relationship with the relevant merchant. If the merchant hasn't followed all the security protocols they may get charged back, but if they have, then the acquirer has to absorb the loss. Too many such losses mean the income from a merchant is less than the cost of chargebacks and, again, card facilities might be withdrawn.

Sorry to hurt your feelings but I can only comment on my prior dealings with section 75. I’m 39 years old so still too young to be that suspicious of bankers so that is in their favour at least :)

 

All I can say is with my credit card company, Post Office (Bank of Ireland) even though it was a completely open and shut straight forward case including photos, diary and video evidence I had a year of jumping through hoops. And they only paid out once  the merchant had ceased trading and they realised they were not going recoup or mediate any losses with the Merchant. It was quite obvious that the department I was dealing with in Dublin had a mandate to make section 75 claims as difficult and laborious as possible in the hope people just wouldn't bother, which in all honesty is the obvious business ploy as it is with insurances.


Had this been Black Horse finance who, in this case would have owned the vehicle outright they would have been inclined  to act much sooner as it’s in their vested interest where as, let’s face it, giving free section 75 money away is not in anyone’s business interest so it will never be straight forward, just read Martins money articles on it.

 Whichever way you look at it and whatever the finance package the banks are only in it for profit and everything else is secondary IMO.
 

When you make the vehicle and potential depreciation of that vehicle the profit margin along with interest payments then that vehicle is the focus of that particular business model. Anything else is just sales bluster. 
 

All of that and my undeniable scepticism of the banking industry aside in my case the did pay out. This is something that would not happen in many other countries with not so pro consumer legislations. 

Edited by Pembssurfer
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My only comment is that all these charges and costs are paid for by us in the Interest rate charged, no matter who the provider is.  

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1 hour ago, Alan Stanley said:

My only comment is that all these charges and costs are paid for by us in the Interest rate charged, no matter who the provider is.  

Quite right. For our newly purchased van I managed to get a low interest unsecured personal loan at 4%. Think black horse finance deals are currently starting at 6.9% atm for HP, and that’s providing a good credit rating. 

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Posted (edited)

So are we saying, its better use finance for part of the purchase rather than using a credit card if future van problems need resolving? 

Edited by gtepete
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We did the deposit on the credit card so we have a 100% cash back guarantee. The rest we did as cash  and financed the outstanding balance. I would never buy any thing £1000+ from anyone without the credit card taking the risk first.

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Posted (edited)
46 minutes ago, gtepete said:

So are we saying, its better use finance for part of the purchase rather than using a credit card if future van problems need resolving? 

You’ll struggle to get a finance package to protect you unless it’s a Black Horse type one on a hired purchase agreement or PCP as they legally won’t have ownership over that van. So in short; unless you want to pay for a large chunk of it on black horse on HP/PCP over a period of years then you are probably best off going down the CC route and putting a sizeable deposit down using the CC. At least that way you can pay it off when you want.

Edited by Pembssurfer
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Simple we paid the deposit via Credit card.  No interest as it was paid off but established any responsibility 0n their behalf.  The remainder after trade in was finance on Black horse.  But not for very long, once satisfied with the van I paid the vast majority of that off as well, so we only paid a couple of months interest.  Kept the remaining small amount on Black Horse with enough outstanding to keep them interested but so little owing the payments and therefore interest are really not worth worrying about.  That way we always have them on side so to speak. 

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Section 75 of the CCA say that the card issuer is liable for any sale between £100 and £30,000.  If the total of the sale is less than £100, or more than £30,000 there is no cover.  So buying a car for £40,000, say, and paying any size chunk of it by credit card provides no Section 75 cover at all. Buying a car for £29,999 (to be safe) and paying just £1 of it by credit card and you are covered under the CCA. It is a common misconception that you have to pay at least £100 to get S75 cover but that is not the case, any amount will do, providing the total transaction is over £100 and under £30,000. 

 

In most such cases the card issuer has no vested interest in delaying or gerrymandering the issue because they normally don't end up 'holding the baby'. They will, eventually, use the card scheme chargeback rules to reverse the transaction to the acquirer/processor. Sometimes that can be just a different department of the same bank. For instance if you use a Barclaycard and the merchant's acquirer is Barclays Merchant Services. Or as it was in my day, if you used a NatWest issued card and the merchant's acquirer was NatWest Streamline Merchant Services. However with the plethora of card issuers these days and the advent of non bank owned merchant acquirers, like Cardpay the likelihood of that happening is fairly slim and shouldn't affect the way the issue is handled. 

 

 

I've got nothing to do on this hot afternoon

but to settle down and write you a line.

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If the purchase is over £30,000 different legislation protects you but there are differences. Check with the CItizens Advice we site.

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  • 4 weeks later...
On 30/05/2021 at 13:24, angie2020 said:

Hello, 

 

we were not going to use finance to buy due to high interest rates  , however, after reading some of the posts if there are issues it appears to be helpful in getting a resolution if finance is involved in the purchase ?

 

is it prudent to pay a big deposit and leave only a little bit on finance 

 

thanks 

There are pro and con to finance however and deposits, its all down to personal preference and your budget.  We try to put down the caravan plus a couple of thousand remainder on finance this is due to if on finance any problems the finance company will assist with your issues and they tell dealers as a last resort to sort it or they will remove their finance package which is where they make money.  Its like a small insurance package for you without paying for it, hope this helps.

 

 

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