The Best Car Finance Blog In The World

There is no industry that I know that surrounds itself more with mystery and ‘smoke and mirrors’ than the motor and associated finance industry. Emissions, fuel consumption, APR, PCP, warranty the list goes on. These are all provided by manufacturers, dealers and funders in ways to totally mislead you.

We are now being fed a pile rubbish as we see the growth in plug in hybrid cars. We are told that they are great for the environment and you get a zillion miles to the gallon, as a result the Government gives you a chunk of money off the new car cost as they ‘apparently’ create less carbon dioxides than diesel and petrol engine cars.

We are told that the Government applies a grant of £2,500 if the electric part of the drive unit can achieve a range of up to 70 miles. More than 70 miles and you can have a grant of £4,500 but you have to bear in mind that the hybrid car is much more expensive than its petrol or diesel equivalent in the first place, certainly much more than the grant provided as an incentive.

Plug in hybrid electric vehicles (PHEV) look very impressive, low fuel cost and tax incentives are grabbing the attention of fleets as well as consumers but the problem is that not all drivers are driving these cars as they should be. The most common omission is the recharging of the car on a regular basis. This in itself can increase the whole life cost by 15% according to Wayne Millward, Fleet Consultant at contract hire company Arval.

For fleets the low benefit in kind tax is very attractive to employees but equally the employees aren’t that interested in efficiency. Even more so if fuel is provided as part of their employment package so they don’t ever plug in their cars to an electric charger. There are of course others who don’t have regular access to charging points, either at home or in the street where they park, making it virtually impossible to charge the batteries using the plug in option.

Either way, when the car moves over from the electric motor to the petrol engine, fuel efficiency plummets and CO2 emissions increase. So unless you or your company drivers use the cars as intended you could be vastly out of pocket. From a running cost point of view if a PHEV is not used as was intended the costs soar and the atmosphere suffers. You would be better off driving a normal diesel or petrol.

So why don’t the car manufacturers do anything to address this issue? I’ll tell you why, because the more hybrid cars they sell the lower the declared average CO2 emissions of all the cars they provide across Europe. In 2015 they had to get the average emissions down to 130g/km which most did.

However, this was based on the manufacturer’s claimed CO2 emissions for PHEV’s being included in the mix, assuming that the cars were regularly plugged into the mains. The fact is that very few were and is yet another con trick perpetrated by the car manufacturers as they know this is what happens! By Graham Hill

Now here is something really interesting that proves you can learn something new every day! And this piece of information could affect every single driver with his own insurance as well as companies running fleet cars. It all came about after I read a question regarding 3^rd party damage, following a car accident, when the damage is caused to local authority owned property.

For example if you were to hit a road sign or street light or maybe smash into a bollard or worse still damage barriers or even the road surface. I was shocked to read that a company running a fleet of vehicles was billed £46,000 for barrier repairs without realising the length of the replacement barriers.

The warning was raised by claims management company actually called Claims Management & Adjusting. They had found that in particular fleet operators were being targeted by local authorities for some obscene repair costs. As it turned out the claim mentioned was for a much shorter stretch of barrier as the authority had claimed in yards but the length was only a third as the measurement was actually in feet, not as stated in yards.

After pointing it out the claim was written off. The claims company also claimed a success when an invoice for £56,000 worth of re-surfacing work was challenged after obtaining information under the Freedom Of Information Act that showed a larger stretch of road had been repaired for £750.

It would seem that not only are there a few disproportionate claims for damage but Highways England has allowed certain contractors to decide upon charges and repairs without further reference as long as the claims were under a threshold, commonly £10,000. This caused me to look further into this situation and what a can of worms it turned out to be.

Most people are of the opinion that you only have to report an accident to the police and your insurance for the following reasons; if someone has been injured (report to police and insurance), there is a claim going to be made against you by another motorist (insurance only) or you are going to make a claim on your insurance for damage repairs to your own car or your contents/passengers (insurance only).

However, knock down a bollard and cause little or no damage to your car you may think that this is the responsibility of the local authority and simply drive off. In fact you have caused damage to a third party’s property so by driving off you could be committing a criminal offence. But then you may think that no-one saw you so where is the evidence but with CCTV cameras and people with mobile phones everywhere you may find that several weeks later you receive a bill for the damages.

But having not reported the accident to your insurance company within a certain period (see your policy) they may no longer be obliged to pay out. It seems  that it can take several months for a local authority to make a claim against a driver. Whilst I’m told that every car insurance policy will cover you for third party damage, that isn’t just someone else’s car or someone’s front wall, it also covers you for what is known as ‘street furniture’ which includes road signs, bollards, hoardings etc.

But if you fail to meet the terms and conditions of your insurance policy or they can prove contributory negligence you could be facing a hefty repair bill. In addition you are obliged to stop after an accident and pass your details to anyone involved or the owners of property that has been damaged. If there are no casualties you don’t have to involve the police.

However, if you have damaged privately or authority owned property you must report the accident to the police if the owner of the property is not available to take the details from you. So as you can see this is a bit of a minefield and what may have seemed like a minor accident could potentially leave you thousands of pounds out of pocket! By Graham Hill

I don’t know about you but speed cameras totally confuse me. Many have been shut down around the country because they were too expensive to keep going which is strange because I would have thought anything more than a couple of fines a week and they would be in profit.

I’m a believer in speed cameras being installed near danger spots such as schools, old people’s homes and play areas but as we know they were often put up behind a bush, tree or building where there was no extra danger to pedestrians or other drivers, they were there to catch motorists and boost the coffers of the local authority or those managing the cameras.

Well that’s what I thought but I clearly got that wrong with so many shut down. On the other hand those who argue against speed cameras would claim that they are unnecessary as the number of detected motoring offences more than halved between 2004 and 2014, from 4.33 million to 1.62 million, in their minds proving that cameras are unnecessary. Really?

Maybe it has something to do with the huge drop in active speed cameras. Having reviewed the situation a committee of MP’s have suggested that relatively low cost average speed cameras should be used more widely. These would help to replace the large drop in traffic police who not only caught those speeding but also acted as a deterrent parked at the side of motorways or simply cruising our roads.

The committee have recommended that revenue generated by fines should be re-invested, through road safety grants, rather than kept by local authorities. Even with the shut down of many Gatso’s 90% of all Fixed Penalty Notices in England and Wales are detected by cameras. Exceeding the speed limit resulted in 254 fatal accidents in 2014, 16% of all fatal accidents, as well as 1,199 serious accidents.

Whilst the committee has recommended the use of average speed cameras there are some experts that have said that you have to ask why people speed and in many instances it is a result of being under the influence of alcohol or drugs, so these people get away with a fine and points for speeding when in fact they were committing a much more serious crime.

Speed cameras also allow those driving carelessly or without due care and attention to get away with a relatively small fine and 3 points. Personally I’m not sure what the answer is but time will tell if the roads are made safer through the installation of average speed cameras on motorways and A roads. By Graham Hill

I know we all get a little irritated when we see the sign ahead slowing us down to 40mph and the 3 lanes we were happily trundling along about to reduce to a mere single lane but I didn’t realise that when this happens that the roadworkers are in serious danger.

Not of being run over by an inattentive speeding motorist, although this does happen, but in danger of being duffed up by a motorist who feels annoyed that he has been slowed down, abused, spat at, hit with all sorts of projectiles etc. Labourers near Wivanhoe in Essex have been subject to increasing violence from passing motorists whilst creating a new cycle lane, with one motorist caught brandishing a knuckle duster.

The local council has now followed other councils with similar problems and issued workers with police style body cameras to hopefully act as a deterrent as well as provide proof in the case where an attack takes place leading to a prosecution. Other councils suffering similar problems are in the North East and Midlands leading to the issue of these cameras to workers. Reports of attacks range from workers being punched to being shot at with an air rifle.

Ten companies that carry out roadworks have reported 441 incidents in one year alone, including 174 physical attacks. With this scale of incidents it probably won’t be long before all roadworkers are issued with body cams and even portable CCTV to record any illegal behaviour or attacks by motorists.

A sad reflection on our society when people are just doing their jobs. And if you want to duff up someone find the health & safety pen pusher who decided to cone off 5 miles of road for a hundred yards worth of repair work! By Graham Hill

You will probably remember the sad case of the Glasgow refuse truck driver who fainted at the wheel resulting in an accident causing six people to lose their lives and several more to suffer injuries.

The driver had suffered fainting attacks since 1976 but this was unknown to his employer who was held responsible, as any employer would, for the actions of their employee and for allowing him to drive their truck in the first place.

This was still the case even though they claimed that the driver had not told them of his condition. But this raises an interesting point because I only recently found out that it is unlawful for an employer to ask a job applicant about their disability or health until after they have been offered the job.

How crazy is that? However, you can apply for the medical records on the applicant, provided he or she agrees, under the Access to Medical Reports Act 1988. The medical practitioner (normally the applicant’s GP) is then obliged to provide the records requested.

If you are an employer who either provides company vehicles or pays employees to drive their own vehicles on company business by way of a car allowance or pence per mile, you have an obligation to ensure that they have the appropriate licences and do not suffer from health conditions that may affect their driving.

As an employer you are able to carry out regular assessments on drivers to ensure that they are still fit to drive. And as an employee if you have a condition that may affect your driving you are equally obliged to make your employer aware. By Graham Hill

There’s an app for that is rapidly becoming part of everyday conversation. Having created an award winning app myself that enables users to compare lease deals or simply to evaluate a deal to see if it represents good value, I know that app boundaries are limitless.

The latest app relating to motoring is aimed at younger, less than responsible, drivers that could help to prevent an accident, reduce their insurance premiums and help parents to worry a little less. The app has been created by employee tracking specialist, Romex. The app uses the driver’s phone to detect whether the car is exceeding 4 miles per hour via the phone’s GPS system.

At this point the app locks the device disabling calls, texts, emails and social media accounts, amongst other distractions. It can also monitor the speed the car is travelling at and the time spent driving. The company already has a similar product available to fleet users as part of its telematics systems to help companies and drivers to comply with legislation.

The maker has announced that the new app could be available as early as May 2016. Sales director, Steve Arscott explained, ‘It’s called distraction prevention, we’re approaching younger drivers because they’re the ones most likely to be glued to their phones.’ There will be a charge for the service and it will work alongside another of their apps called Guardian, which allows parents to monitor where their youngster is and whether they have been speeding – just as companies can do with their fleet drivers.

The company is optimistic that they will find an insurance company to partner up with, providing users with a rebate on their policy. The Guardian app can be extended to non drivers for worried parents who want to know where their off spring are. I’m sure it will lead to some very interesting debates between parents and children! By Graham Hill

If you are a regular reader of my posts you will know what section 75 of the Consumer Credit Act is and the way that it makes the finance company jointly and severally liable in the event that you have a ‘fit for purpose’, ‘miss-representation’ or any other breach of contract claim against the dealer.

The general perception is that first and foremost the dealer is responsible so you immediately take up the problem with the dealer which invariably gets you into a bit of a dispute. However, I am reading about more and more cases whereby the customer has immediately taken up the case with the finance company, which tends to take the side of the customer and roll over, somewhat quicker and easier than the dealer, leaving a very happy client and the finance company to battle out the recovery of any money they have spent from the dealer – not your problem.

In fact it is often the case that before making finance available to a dealer he must sign up to an agreement that simply says that in a dispute with a customer that the funder settles, the dealer is responsible to refund the cost. The agreement, in my opinion, shouldn’t be needed as it is covered off in sub-section 2 of section 75 of the act, as follows:

75 Liability of creditor for breaches by supplier.

(1)If the debtor under a debtor-creditor-supplier agreement falling within section 12(b) or (c) has, in relation to a transaction financed by the agreement, any claim against the supplier in respect of a misrepresentation or breach of contract, he shall have a like claim against the creditor, who, with the supplier, shall accordingly be jointly and severally liable to the debtor.

(2)Subject to any agreement between them, the creditor shall be entitled to be indemnified by the supplier for loss suffered by the creditor in satisfying his liability under subsection (1), including costs reasonably incurred by him in defending proceedings instituted by the debtor.

The fact is that if you have taken out finance on a car, usually HP or PCP, and you feel that you have a claim against the dealer I would suggest that you challenge the finance company and if they ask you if you have already taken up the case with the dealer, point them in the direction of the Consumer Credit Act 1974, section 75.

As an aside I asked a lawyer friend of mine in the industry why the lender is more likely to roll over and he explained that if you took up the case against the dealer your recourse would be via the fairly wet fish Trading Standards but if you escalate a claim against a lender your recourse would be via the gritty Financial Ombudsman Service and if they investigate a claim they immediately charge £550 per claim investigation (in fact I believe they are allowed 25 claim investigations before they incur a charge). So there you have it. By Graham Hill

Just to prove my point regarding my insurance premiums, law firm Thompson’s Solicitors, has produced a report that shows that over the past 5 years insurance claim payouts have decreased whilst premiums have increased allowing the insurers to pocket £7 billion since 2010.

In response the Association of British Insurers (ABI) has hit back claiming that Thompsons, a claims solicitors, are upset with Government plans to end the right to cash compensation for minor injuries like whiplash and to increase the upper limit for small claims court personal injury cases to £5,000.

Thompsons reported that premiums between 2010 and 2014 had dropped in real terms and motorists were paying less in 2014 than they were in 2010 but cumulatively premium income increased by £353 million whilst insurers saved £7 billion in payouts. There has been a net drop in the number of motor claims made of 4% but the net cost of claims incurred is down by nearly 30%.

The ABI refutes the claims made by Thompsons and suggest that savings of £1 billion have been passed on to motorists. Who’s right? I don’t know but I would suggest that much of the increased income is down to people not thoroughly checking their insurance renewals. By Graham Hill