Every week, we answer your financial problems or consumer disputes – you can email [email protected] with yours. Our latest problem, available to newsletter subscribers first, is from cjenk, who asks…
My partner bought a nearly new car from a garage three months ago, it has since become undrivable with both the garage and the finance company refusing to give a refund or repair the vehicle with a huge list of issues that couldn’t have occurred since it was bought. What can we do?
Buying a car is one of the biggest purchases we ever make, so we were sorry to hear about your experience.
We asked Complaints Resolver Scott Dixon to look at this one – he’s advised on hundreds of similar cases and has been through a similar dispute himself (of course, he won).
Hopefully his advice can help you resolve this case – and others who find themselves in a similar situation.
Dixon writes…
A car purchase creates more complaints than anything else.
Money Problem: ‘My brother-in-law has to go – but I don’t want to be his guarantor’
Money Problem: ‘British Airways agreed over phone to refund nearly £1,500 – but then only gave me half’
Money Problem: ‘easyJet wouldn’t refund a name change despite my sister-in-law’s dying wish’
Standards, attitudes and the culture in the industry need to change radically.
Although we have some of the best consumer laws in the world, so many traders flout them, leaving consumers vulnerable or ripped off without knowing their rights.
First up, you have a short-term right to reject faulty goods including cars within the first 30 days under Section 22(3) of the Consumer Rights Act 2015, although the onus is on you to prove the goods were faulty when sold.
After this, any faults found within the first six months are considered to have been there at the point of purchase. The burden of proof is on the retailer to show otherwise.
You only need to give a trader one opportunity to enact a free repair. If that fails, you can reject it but that’s easier said than done.
If the car has a long list of faults that renders it undriveable, it clearly doesn’t meet the Consumer Rights Act 2015, which states goods sold must be:
In this case, the finance company has bought it from the dealership, so you can pursue a S75 claim under the Consumer Credit Act 1974 (depending on the finance agreement – I have seen some deliberately sold as personal loans disguised as Personal Contract Purchases) so you would need to look at that closely.
Although all faults within the first six months are considered to have been present at the point of sale, I would recommend an independent inspection report from a reputable garage or the AA or RAC to reinforce this under the circumstances.
Keep all communications with the garage and finance company in writing, and get any verbal promises confirmed in writing.
Amnesia is a common medical condition in the trade, where staff have sudden memory lapses and struggle to recall what was said and promised on such disputes.
The next step would be to submit a formal rejection letter by email and recorded delivery to reject it under the Consumer Rights Act 2015.
Don’t let the garage or finance company fob you off with excuses like “wear and tear” or “you accepted the car as seen” – this does not apply under the Consumer Rights Act 2015. S31 addresses this specifically.
Final right to reject
S24 of the Consumer Rights Act outlines the right to a price reduction or final right to reject, after one chance to repair.
Offers made will be calculated on the anticipated lifespan of the goods – time of use and depreciation. Ask for any offers made to be evidenced with calculations to ascertain how the amount has been arrived at. Never accept the first offer unless you are happy with it.
Car dealerships will often cite that they are entitled to deduct 45p a mile for use on refund calculations when you try to reject a faulty vehicle. This is false and a scam. The Financial Ombudsman Service (FOS) has ruled this as unfair on previous decisions and HMRC do not provide guidelines for car dealerships to use on fair use deductions. The FOS has ruled 25p a mile is fair and acceptable.
Check to see if the garage is a member of the Motor Ombudsman scheme as well, as that may be another avenue to pursue, but I’ve found it to be a blind alley to be honest and one I wouldn’t recommend.
Read more:
‘My dog died and insurance company charged me’
Why some in Labour are arguing for a new tax
Should you get a Lifetime ISA?
Don’t fall for warranty ‘fob off’
Car dealerships will often offer a one to three-month warranty on used car sales and say “it’s out of warranty/the warranty doesn’t cover this” if any issues arise.
The Consumer Rights Act 2015 provides you with an implied statutory warranty for up to six years in England and Wales and five years in Scotland – and gives you better cover for free.
Nobody ever needs to buy an off-the-shelf warranty.
Contracts
If a car dealership is trying to enforce a spurious term to deny you a remedy, ask them to direct you to the specific paragraph in their terms and conditions.
The Consumer Rights Act 2015 has a fairness test. Key terms need to be prominent, fair and transparent.
Advice when you buy a second-hand car
This feature is not intended as financial advice – the aim is to give an overview of the things you should think about. Submit your dilemma or consumer dispute via:
