Excess mileage on a PCP – what to do

OK,  let’s see if I can explain and ask this clearly!

Our deal ends in March,  we’re at a point where we can voluntary terminate now.  There’s enough bodywork problems (few minor dents and all the edges of the doors are chipped)  to mean there will be a charge and the car is not desirable as a part ex, but that’s not the main problem.

We’re way over the excess mileage.  In March,  the limit is 24,000. Right now,  pro rata, it’s 15,500.

We’ve done 24,000 already!

The charge is 9p a mile.  But looking at the small print if we go 30% above the limit,  that portion will be charged at double the rate.

So,  do we get out asap because potentially right now every mile might cost 18p? Or do we wait til March by which time the pro rata amount will have caught us up somewhat (we don’t do as many miles as we have been doing,  but we still want to be able to get out and about without worrying!)

At the time,  the deal was fine but circumstances changed and we ended up doing way more driving than expected. It is what it is and we’ll just have to suck it up, but I’m not sure what the best thing to do is!

If you voluntary terminate then in theory excess mileage charges can’t be applied.  They’re a contractual term so are disallowed from being applied under s100(1) and s173 of the CCA.

There’s a reasonable section on legal beagles on it.

As above, loop hole in the law, take it back and walk away, I’ve know people take cars back with over 100,000 on clock and only signed the minimum 6,000 per year

I hear a lot of people take their cars to one of those mileage ‘correction’ places for this sort of thing. Not sure if there are ways for the leasing companies to spot this, over and above the higher than expected wear and tear. There are a lot of very expensive looking cars around my way with silly low mileage contracts to make them affordable yet they are driven quite a way everyday to places of work.

Pop it on jacks, pop it in reverse and leave a block of wood on the gas. What could go wrong?

🤣 at the DTs

I believe that it’s usual f for the car to get kicked repeatedly and then plummet through a window into a pine forest.

Haha,  I don’t have any pent up issues with my father so it might be OK!

Is this true then?  A voluntary termination means no excess mileage charge!?

Edit – I’ve just tried reading some of the discussion on legal beagle and to be honest I’m absolutely baffled! The contract I have states I will be subject to excess mileage charge even if I VT. Surely I’ve accepted that by signing the deal!?

I hear a lot of people take their cars to one of those mileage ‘correction’ places for this sort of thing

Dont do this!   Manufacturers, lease and finance companies are already all over this and if the catch you they will persue, which is becoming easier!  Basically it’s commiting fraud.

OP I would VT the vehicle now, you may be lucky with damage recharge.  Consumer finance companies are more lenient than lease providers due to slightly different regulation.  That said it maybe worth getting some of the items that fall outside of Fair ware and tear sorted before returning

Or just plan to buy it or trade it at the end of the term?

We were in a similar situation, and sold ours to a garage for stock. 🙂

Ring round local garages for the manufacturer and see if any would be interested.

The contract I have states I will be subject to excess mileage charge even if I VT. Surely I’ve accepted that by signing the deal!?

<span style=”font-weight: 400;”>Section 100(1) of the CCA confirms that liability is restricted to one half of the total price payable. The ‘total price’ is defined as the total sum payable under the agreement or a conditional sale agreement </span><span style=”font-weight: 400;”>excluding any sum payable as a penalty or as compensation or damages for a breach of the agreement.</span><span style=”font-weight: 400;”>
</span><span style=”font-weight: 400;”>
</span><span style=”font-weight: 400;”>The excess mileage is a contractual term of the agreement and therefore cannot be included as an amount which is owed upon VT. This is clarified under s173 of the CCA which states that any contractual term which is inconsistent with any rights under the CCA and imposes additional liability, whether direct or indirect, shall be void and unenforceable.</span>

So why doesn’t everyone sign the min mileage and then VT? Is there some negative result to doing it? Can you only VT at the mid way point or can you do it 5 days before the deal ends?

Forgive me I know nothing about PCP!

If you take it to a mileage adjustment place this will only work until the garage plugs in the manufacturers computer then if flags it.

If caught doing this you and then the person who did it will be having to answer questions that will not help any negotiation.

If you are open to another lease then the vendor will often waive any fees on the returned car.

Find out from them how much it’s gonna cost to go early, and lease another from them, more chance of them playing nicely, and be realistic about your mileage this time.

Find out from them how much it’s gonna cost to go early, and lease another from them, more chance of them playing nicely, and be realistic about your mileage this time.

This +1

But only if you want another car from them.

However it sounds like the vehicle you’ve got isn’t in the best condition, so any deal will be based on the resale value including all the fixes (should they be deemed to be worth doing) on the car. You will probably get charged for the work to fix the bodywork anyway, so why not just own up to the fact and talk to the dealership about the cost of repairs and then the mileage overrun costs?

Don’t honestly think you can get out of this one by your own admission, so the only deal you may be able to make is one that includes PCP’ing another car from the same dealership and see what deal they’re likely to come up with…

Or, hand it back early and possibly get stung for the repair costs and over mileage charges too.

Your choice.

Regarding why everyone doesn’t do it – I believe it counts as a grey mark on your credit record. A colleague has done it twice and now can’t get finance for another car.

So why doesn’t everyone sign the min mileage and then VT? Is there some negative result to doing it? Can you only VT at the mid way point or can you do it 5 days before the deal ends?

To VT you have to have repaid 50% of the total purchase cost of the vehicle, once you’ve done that you can do it at any time.  On my previous PCPs there was some residual value in the vehicle so it was a more attractive option to use it to part exchange against a new car.

On my Yeti the final value estimate is way too high (getting on 15%), I assume done to make the monthly payment look more attractive.  There is a negative residual so part-x isn’t an option and buying it from them leaves me on the wrong end of thetnegative position.  So with 8 months to go and needing to change vehicles because of life changeschan 2 options remaining are run to the end of the contract and hand it back incurring additional payments, wear and tear and mileage deductions in a car that isn’t appropriate any more or VT.

VT will leave a termination flag on your records but there are no details against it and a termination isn’t unusual so it won’t be considered an issue on credit records, however the company you VTd with will see it and it may impact on their decision to issue you with future credit arrangements.

I suspect that this might come back with some force soon as there were some silly numbers floating around on PCPs and leases when I bought my Yeti driven by optimistic GFVs.

The mileage thing is only a backstop for the dealer. The point of PCP for them is to provide a steady supply of decent used cars into their used car network. So if you’re moving onto another car with them or buying out then it’s irrelevant, it’s only a problem if you want to hand the car back and walk away so they can limit any exposure to losses. And if your plan was always to hand the car back and walk away then PCP is not for you. Almost everyone I know runs PCP’s, have had several cycles of it and never had an issue with excess mileage.

We’re in the early stages of changing my wife’s car and she’s over the mileage, so far it has not even come up in the discussions with the dealer. We’ve already worked out the financial side of the deal and just ready to press the button….but my good wife recently severely kerbed the car way beyond restoration, so I need to either source a replacement wheel or fess upto the dealer.

You did the miles.  You should pay accordingly.  What is it with people signing for stuff then trying to wriggle out of it.  Same with parking tickets.

Anyhow, VT is an option you can take but then you get the situation of return conditions and it sounds like you haven’t looked after it so well.  Maybe the company can come and get their pound of flesh back off you in that way if they feel you are pulling their leg.

anyhow, my suggestion would be a little more honerable.  Call them up and ask for a settlement figure on the contract.  Then find out how much the car is worth with it’s existing mileage and condition.  Then work out the difference.  If that is remotely near a ‘dealership’ price to tidy the paintwork up then it would maybe make sense.  Alternatively if you plan to go elsewhere and buy a car it’s quite easy for another dealership to put a package together to settle your finance and get you into another car.

Regarding why everyone doesn’t do it – I believe it counts as a grey mark on your credit record. A colleague has done it twice and now can’t get finance for another car.

Correct, a ‘grey’ mark indeed.

VT isn’t a ‘loophole’ or anything as shady as that, it’s right there in the paperwork when you sign.

The point of it is a bit of an old school one to ensure lenders don’t take too risky lends on, basically if they’re silly enough to allow tiny deposits, massive final values/balloons so consumers can have brand new £30k cars for £200 a month then on their head be it. The entire vehicle market is based on these types of lends so it’s hardly rare these days.

If you VT then the entry on your credit history will show “settled by Voluntary Termination” that tells any other potential lender that the last one probably lost money on you. Now, they’re not really allowed to discriminate against anyone who does the ‘right and proper thing’ and VT is a right and proper way to end a finance agreement. If you look as a consumer account it will be green, which is nice.

I don’t think any humans are allowed to enforce underwriting rules these days in case heaven forbid they exorcise some digression, but when I did we were told all of the above, then reminded that no one ever VTs a vehicle that’s not worth less than owing and by the time we pay auction fees it only gets worse – DON’T LOSE THE BANK MONEY. I would never finance a vehicle or any other secured asset for someone who’d recently VT’d, because you might as well give them £5k in an envelope and be done with it.

Personally? Give the above, you can do the right thing, speak to the finance company now and they may allow you to up your repayments now to what they would have been if you’d asked for 18k miles a year or whatever, or they might do you a deal for repeat business.

If you can’t face that, or don’t want to, by all means VT, it’s morally wrong in my book, they haven’t put you in a position where you’re financially upside down with the car, you have by going over the mileage and the damage, but sometimes shit happens.

If you plan to take another car on PCP, I’d recommend doing so within days of VTing, credit files take a month or 2 to update, VT, get another one, with a more realistic mileage, try not to damage it and by the time you need to replace that one, the VT will be old and no one will care so much, 6 years after the day you first took the car it’ll fall of your record anyway.

You did the miles.  You should pay accordingly.  What is it with people signing for stuff then trying to wriggle out of it.  Same with parking tickets

Bit harsh and if you read my original question, it’s not exactly what I’m asking. I’m wondering whether to VT now and pay the mileage excess as it stands or wait til the end and allow our pro rata mileage allowance to catch us up a bit, all taking into account the extra charge for going 30% above the allowance.

Unfortunately, the current car hasn’t quite lived up to being the ideal family wagon I hoped it would. We would like the conv<span style=”font-size: 0.8rem;”>enience of a much bigger car (we’re thinking Octavia.) We’re with citreon at the moment, so unless they have a used one in, I can’t go back to that dealership, unfortunately they don’t really have a car to suit us.</span>

We knew we were having a baby, but we didn’t know that she would be the terminator and we would have to rely on driving her around endlessly to allow her to nap during the day. The mileage normally would have been plenty, but this combined with dropping to one car instead of two has resulted in excess mileage.

Whatever we pay, I will suck it up and accept it because I signed the contract and I accept it was necessary in order to get some peace from the little one!

You can part-ex a PCP car with any dealer.

Just last my wifes Panda was due for renewal and she was over the mileage – we went to a Skoda dealer and part-exed at market value it for a Fabia. Skoda payed off Fiat and all was good.

I think we were a couple of hundred quid on the wrong side but this was rolled into a the new deal.

Mmmmm PCP. Or angel dust as we used to call it.

We knew we were having a baby, but we didn’t know that she would be the terminator and we would have to rely on driving her around endlessly to allow her to nap during the day. The mileage normally would have been plenty, but this combined with dropping to one car instead of two has resulted in excess mileage.

**** me! I’ve heard it all now.

We’re way over the excess mileage.  In March,  the limit is 24,000. Right now,  pro rata, it’s 15,500.

We’ve done 24,000 already!

The charge is 9p a mile.  But looking at the small print if we go 30% above the limit,  that portion will be charged at double the rate.

So,  do we get out asap because potentially right now every mile might cost 18p? Or do we wait til March by which time the pro rata amount will have caught us up somewhat (we don’t do as many miles as we have been doing,  but we still want to be able to get out and about without worrying!)

Not doing the morals thing, which TBF I don’t think is being wriggled on at all, just the maths.

If with 6mo to go your pro rata is ca 15,500 and total allowance is 24,000 then I surmise you’re on a 2 year deal at 12,000/yr.

If current is already 24,000, you’re doing 16,000 / yr currently so another half year of that would be 8,000 taking you to 32K give or take, but you say won’t be as much so let’s guess at say 30K. 6K excess at 9p is £540, and your 30% above number is 31,200, so you have a spare 1200 miles before you get into penalty territory, and the way i read my wife’s PCP is that it’s only what’s above the 30% that is charged at double.

So if you do 31,250, you don’t pay 7250 @ 18p, you pay 7200 @ 9 and 50 @ 18.

Frankly, at this stage and given you are going to be dicked by them over the bodywork anyway (did the Terminator do that too 😉 ) I wouldn’t sweat it, go to the end and accept that you’ve been saving that £500-odd in the form of your actual monthly should have been £20 higher if you’d inputted the ‘right’ mileage in the first place.

The best reply by a mile p-jay

I did a Voluntary Termination twice in a row; the second time on a 0% deal. Couldn’t get PCP for 4 years afterward so make sure you have a backup plan for a replacement car…

Interesting one this as I’ve been looking in to the whole VT thing myself recently. As has been said above it won’t affect your credit rating but my make the dealer/manufacturer you’ve VT’d reluctant to finance you again.

Our situation is that we have 18 months left on our 1 Series but it’s getting too small for our growing family, even as a second vehicle. It was actually BMW themselves that alerted us to VT as a way of changing early and suggested that it usually becomes an option when there’s about 12 months left on an agreement with them. To be fair though we are within the mileage and the car is in VGC so the difference at 12 months wouldn’t be too much anyway.

We decided in the end to just PX the car with a different manufacturer as they had a promotional weekend on with extra money available and a special edition model that had plenty of extras we liked for the price of a standard model. Yes, we still have to pay the £1500 difference between value and what we owe but after discounts, deposit contributions and some messing with figures we got a bigger vehicle at a price we’re happy with and no worries about credit, blacklisting or just the general PITA handing a car back via VT would inevitably be. If you’re planning to get another car on PCP I’d be going down this route.

I used to have a mate at the local Ford garage who explained their PCP to me years ago. Back then they used to pitch the GFV at a level that would mean if you stuck to the agreement and looked after your car you’d have a enough money in the car to pay the deposit on the next. Always thought this was the case for all agreements until my current Kuga came to the end of it’s deal and the price we owed/paid was about bang on it’s PX value. Saying that I think the drop in value for diesel vehicles bashed it a bit. Having looked at our BMW agreement there’d be very little extra left if we went full term with that too even though it’s petrol. On the other hand, Land Rover still price them so you’ll have a decent chunk left at the end. Always worth doing your research.

Regarding why everyone doesn’t do it – I believe it counts as a grey mark on your credit record. A colleague has done it twice and now can’t get finance for another car.

No brother in law to help out?

Should we ask Ling?

😂

I’ve looked at Lings akrrady to get an idea how much the Octavia could be leased for 😜

Skoda were offering low APR and 3 or 4k deposit contribution recently. That should go a long way to offset any cost you incur if you PX. They seemed keen to shift some stock in the summer so if you want a Octavia the first thing I’d do if go and find out what deal they’ll cook up for you.

If we PX with a dealer, do they inspect the car and bill you for damage like at the end of a lease, or just give you a value that goes into the next deal?

If anyone can, Ling can

The mileage penalty is only relevant if you hand the car back to the finance company.

Get a valuation of the car, sell it privately and have the buyer pay off the finance direct to finance company and you keep any difference or put the difference in yourself. The early termination is a bit of a misnomer as it’s classed as negative on a credit file.

If we PX with a dealer, do they inspect the car and bill you for damage like at the end of a lease, or just give you a value that goes into the next deal?

They just give you the market value for the condition/mileage it’s in. You will probably be in a negative situation, but that could be rolled into a new agreement.

Go and see a dealer for the car you are interested in – there is always a deal to be done with a man in a shiny suit! 🙂

I think the grey mark is an error, I.ve VTd two cars with Volkswagen, and gone on to do two further PCP deals with them and my equifax score remained at 999 for the whole time. They actually confirmed it did not affect my credit rating.

A VT is part of your contract which you are fully allowed to exercise once you have paid 50% of the total loan cost.

I would VT at 50% as you get no refund once past 50% and ensure you use a realistic mileage for future cars.

the other option depending on the shortfall maybe to get something with a good Carwow discount and use that discount to offset the shortfall. But VT gives you the best option to walk away.

I think the grey mark is an error, I.ve VTd two cars with Volkswagen, and gone on to do two further PCP deals with them and my equifax score remained at 999 for the whole time. They actually confirmed it did not affect my credit rating

More or less ditto.

christ, just googled ‘mileage correction’ and found my way to http://www.mileageadjustments.co.uk/

Why Us?

Putting it simply, were simply the best, were the most reliable mileage correction company in the industry.

and then this thread – https://www.pistonheads.com/gassing/topic.asp?h=0&f=23&t=1574297

tales of a BMW being clocked from 130K down to 29K, and a Merc that was wound back from 330K to 79K (!!!!!!)

how depressing.

From that website’s FAQ’s

Is it Legal ( Disclaimer)

Adjusting a vehicles digital dash is NOT illegal, it is illegal to knowingly sell the vehicle without disclosing the adjustment to the new buyer.

Scratches head…… and rethinks whether taking advantage of the contractual loopholes in a PCP is that morally dodgy after all, given what some people think is ‘normal’ enough to build a business around.