What happens If I change my mind about my vehicle lease agreement?

Changed your mind about your lease agreement? Here are your options...

what happens if I change my mind about my vehicle lease agreement

Sometimes, you start to have second thoughts about something. A house, a job, or your new car. It happens.

And we understand that sometimes you do change your mind about things, even your lease agreement. But, what happens when you change your mind about your lease agreement?

There are quite a few things that could happen. And while this is quite rare, it has happened in the past. So, we’re going to talk about what happens if you change your mind about your lease agreement at the different points of the order.

What happens if I change my mind about my lease agreement before my car has been delivered?

If you change your mind before your car has been delivered, then there are a few things that could happen. There are different stages in which you can change your mind.

If you want to change your car before it has been ordered from the dealership, then you can do so. In regards to our process, this will be at no extra charge to you as long as you are ordering another vehicle.

If you want to change the car after the car has been ordered from the dealership, then you may face charges. Say you have ordered a BMW but you’ve changed your mind and want an Audi instead, then the dealer now has a BMW without an owner. So, there may be dealer charges.

If you want to change your finance agreement before you take delivery then you can do so again at no extra cost to you. You will, of course, have a revised quotation with your new agreement, so the price may change.

The vehicle is only ordered once the finance has been approved. After that, you have what is called a cooling off period. This is 14 days in which you can change your mind about the finance agreement at no charge to you. This only applies if you are a ‘regulated’ customer, however.

You are regulated if you are a:

 

  • Private individual
  • Sole trader
  • Partnership with less than 4 partners

 

If you are unregulated you do not have this cooling off period. You are unregulated if you are a partnership with more than 4 partners or a Ltd. Company. This means that once you sign, your order stands. If you cancel after that then you are likely to incur charges.

What happens if I change my mind about my lease agreement after my car has been delivered?

Okay, what happens if you change your mind after your car has been delivered?

This depends on the finance house, and what you actually want to change your mind about.

If you have a contract hire and you decide that actually, you’d like to buy the car, then this is what you can do:

 

  • Contact the finance house and get a purchase price.
    • It should be noted that not all finance houses do this, but most of them do
  • Then, you can contact a vehicle broker and ask if they will finance that purchase price

 

If you change your mind about the actual car, then you’ll have to cancel your agreement. Lease agreements aren’t really designed to be cancelled, so it can get quite complicated.

what happens if I change my mind about my vehicle finance agreement

If you have a contract hire then you will have to pay an early termination fee. This will be outlined in your terms and conditions. If you accept that fee, then you can pay it and they will pick up the car. You will still be subject to mileage and condition charges.

If you have a personal contract purchase, then what happens depends on how far along in your contract you are.

If you have a regulated agreement and you have paid 50% of the total payable, you can use your termination rights and hand the vehicle back to the finance house.

Is there a time limit to cancelling my lease agreement?

The finance agreement is not activated until the day of delivery. So, if you want to cancel your agreement or you change your mind then the ideal time to do this is is before the car is delivered. Of course, it’s never ideal but you know what I mean. Up until that point you will only have to cancel your car. While you will still face charges but because you aren’t cancelling your agreement then you won’t have as much trouble.

How much will the cancellation fees cost?

what happens if I change my mind about my vehicle finance agreement

The cancellation fees vary depending on a number of factors. At OSV, the cancellation charges are usually 2 times the monthly rental, and any other additional charges. The cancellation fees depend on:

 

  • How easy the car is to re-sell
  • If the car has a confirmed build slot
  • If the car is in stock
  • How much your monthly payments are (or expected to be)
  • How unique the car is

 

So, these can all play a part in how much the cancellation fee will be.

Who should I contact if I change my mind about my lease agreement?

If you change your mind about your agreement then you need to speak to your broker. They will advise you on what happens next. If you have taken delivery of the car then you should contact your broker but also the finance house. This is because, due to the Data Protection Act, your broker cannot end the contract on your behalf; you have to do it yourself.

What should I consider before cancelling my lease agreement?

Cancelling or changing your lease agreement can be long and arduous, and sometimes it’s not worth it. When you are thinking about cancelling or changing it, you should consider the following:

 

  • Do you genuinely want to change your agreement or vehicle?
    • You need to take everything into consideration, and not just go with a gut feeling.
  • Is it financially viable for you to pay the cancellation charges?
  • Do you have an alternative?
    • There isn’t always going to be another car waiting for you in the forecourt. So, before you change your mind you need to make sure you have an alternative.
  • Can the reason you’re cancelling your car be easily fixed?
    • Sometimes people want to cancel their agreement because they can’t sell their old car. While we understand why people would want to cancel, but this can easily be fixed.
    • The best thing to do before you decide anything is to speak to your broker. Then, they can advise you on the best route to go down.

 

So, you can change your mind. Depending on when you choose to cancel or change your order depends on what actually happens. The best thing to do if you are having second thoughts, however, is to talk to your vehicle broker. They will be able to advise you on the best route to go down.

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Andrew Kirkley

Director at OSV Ltd
Andrew enjoys: Movies and travelling to new cities to explore different cultures.

Andrew has been in the motor trade for over 20 years. What he enjoys most about his job is the team spirit and the dedication of his work colleagues. He also appreciates the teams input in the improvement of the company.
Andrew Kirkley

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  • 5th September 2016

16 Comments

  • Sallyanne| 20th July 2019 at 7:01 pm Reply

    Recently taken out a FL van , the sales pitch telling me I can sell it back to them in a year if I wanted to end the 5 year lease early and simply walk away. After 5 years a 7k balloon payment is required or to sell it back to them and again, end of lease. However here’s my issue, I’ve now discovered I have been entered into a 5 year , no get out, unregulated agreement with a 10k balloon payment at the end. I have also seen the broker has stated I earn 45k a year ( I wish ) and trading as a business which is not correct. I am a sole trader not a business and have no employees. Can I hand this vehicle back and walk away ? I am within the 14 days cooling off period. Is this mis-selling ?

    • Rachel Richardson| 23rd July 2019 at 11:11 am Reply

      Hi Sally,

      Thank you for your question. First of all we need to state that we are not legal experts and you should seek your own independent legal advice on this matter. However, if this were us, we would contact the Finance House directly and say that you want to register a complaint against their broker as they have mis-advised the Finance House of your personal circumstances, which you were unaware of until after the agreement went live. It is your belief that their broker has mis-sold the product and because of this, the product is not suitable for your requirements and you wish to return the vehicle, cancel the finance agreement and be put back in your original position.

      It’s important you follow the Finance House’s official complaints procedure, as you are unable to go to the FCA until you have completed this (to make a formal complaint), which the Finance House will not want you to do.

      It is probably not the right time to say this, but we are assuming you will still be in need of a vehicle. Once you know what is happening with the above, we would love the opportunity to show you how the experience should be. Please reach out to Amanda on 01903 223391.

  • Ibrahim| 17th June 2019 at 8:53 pm Reply

    Hi. I just signed a finance HP agreement form for a used car today. I am to receive the car on wednesday. I have changed my mind and not interested in continuing with the purchase. How easy would it be for me to get out of it? The car was purchased from a car dealer and a vehicle order form was signed. Can it be cancelled as I have not taken the car yet?

    • Rachel Richardson| 20th June 2019 at 10:33 am Reply

      Hi Ibrahim,
      If you are a regulated customer (sole trader, private individual or company with three directors or less) then you have rights to cancel within 14 days.
      We can’t give you legal advice, however, we would recommend that, subject to reasonable administrative costs which will have been referred to in the terms and conditions you signed at the dealership, you can hand the car back and cancel the agreement.
      If you have any legal concerns, please take advantage of an independent legal advisory service (such as the CAB).
      If you are still looking for a new car, please get in touch with Amanda on 01903 223391 and she will be able to refer you to one of our helpful vehicle specialists who will help you to find the right car for you.

  • Ozzy| 3rd July 2018 at 12:18 pm Reply

    Hi, I bought a car on HP last weekend in the UK. This is the first time I have bought a car this way. I decided I wanted to pay the loan amount as I didn’t want to pay 4.95% interest for 3 years, but I still wanted to hand the car back at the end of the period. Anyhow, I have ended up paying the loan amount including the “balloon payment” which has been interpreted as terminating the agreement and now I am the full owner of the car. They will not accept a reversal to this action. I feel mislead.

    Is it possible to get the finance company to reverse their action? Alternatively, can I go into a HP agreement with a different finance company?

    • Abbie Rawcliffe| 3rd July 2018 at 2:39 pm Reply

      Hi Ozzy, Thank you for your comment. One of our team will be in touch with you within the next 48 hours via email. Alternatively, you can give us a call on 01903 538835 to speak with one of our Vehicle Specialists.

  • Andrew Bauer| 17th March 2018 at 12:49 am Reply

    I just brought a Chevrolet home on a lease only to find out it does NOT have a navigation system unless I use the OnStar service. Honestly, I have such a bad taste in my mouth for extra monthly fees, this falls right into that. I have just given the dealer a vehicle that has a real navigation system that I can actually just hit the “Takeme home” button or type in my own address without telling someone! Another useless monthly fee I was not clear on!

    • Abbie Rawcliffe| 19th March 2018 at 2:17 pm Reply

      Thanks for your comment Andrew. I am really sorry to hear about what has happened, unfortunately, we don’t have Chevrolets in the UK anymore so I cant give any guidance on what you can do.

  • D Williams| 3rd March 2018 at 12:08 am Reply

    Hi, I have been leasing an Audi A1 for the past 4 years, and yesterday I went to pay a builder his money and my transaction got declined due to insufficient funds.
    Once I checked my bank account, I noticed that Audi had taken £6800 from my account without my knowledge.
    My lease had obviously come to an end, and they had assumed I wanted to purchase the vehicle, which may have been the case, but because I was so angry, at them removing monies without contacting me(even though they say, that they sent a letter?) I was angry and put an indemnity on the funds and told them to end the agreement and collect the car.
    However, if the truth be known, I actually do want to purchase the vehicle, but is it now too late to do this, or is there

    • Abbie Rawcliffe| 6th March 2018 at 8:45 am Reply

      It sounds like you were on a PCP agreement rather than a lease, on the original finance documents it should have said the date of the final payment unless you have handed the vehicle back. I am surprised they did not make contact, however, by letter or email to advise you of these options. If you can still buy it, it will now be at the discretion of the finance house as technically you have rejected that option. I would phone them, but to put yourself in a stronger position, if possible be able to pay by debit card over the phone.

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