Not upheld: miscalculation of voluntary termination sum and inadequate explanation complaint against CA AUTO FINANCE UK LTD

Decision detail

Summary

Mr V complained that CA AUTO FINANCE UK LTD miscalculated the sum due on voluntary termination of his hire purchase agreement for a second-hand car and provided unclear communication. The agreement contained two loan elements: a car purchase loan of £7,250 and a negative equity loan of £1,454.14. CA calculated the voluntary termination sum as 50% of the car loan (£4,860.80) plus the full outstanding negative equity amount. The ombudsman reviewed the agreement terms, which explicitly set out this calculation method, and found that CA had correctly applied the terms and provided sufficient clarity through written response and telephone explanation. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman reviewed the hire purchase agreement terms which clearly set out two separate elements: the car loan (requiring 50% payment upon voluntary termination) and the negative equity loan (requiring full payment). The agreement explicitly stated these terms, and the ombudsman was satisfied that CA's calculation was correct and had been explained with sufficient clarity through both written response and telephone conversation. The ombudsman noted that Mr V's disappointment with the sum did not constitute grounds for upholding the complaint.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website