Faulty Vehicle Financing Issue
The client acquired a vehicle on finance approximately seven weeks ago. Shortly after the purchase, the vehicle's warning lights indicated issues with key components, leading to a subsequent inability to drive the vehicle. The seller retained the vehicle for repairs over two weeks, during which the client had additional travel costs. The warning lights have reappeared, prompting the client to seek the return of the faulty vehicle and end the finance agreement due to a loss of confidence in it.
Questions about this case
These answers have been verified by a lawyer in the LEAP networkCan I return the vehicle and terminate the finance agreement due to ongoing faults and lost confidence in it?
You may have the right to reject the vehicle and terminate the finance agreement under consumer rights legislation if the vehicle is not of satisfactory quality, evidenced by repeated faults. Since you have experienced ongoing issues resulting in it being undriveable, you could argue that it fails to meet the required standards. It is essential to clearly communicate your intention to reject the vehicle to both the seller and the finance company, ideally in writing. Keep records of all communications and evidence of faults, as acting promptly strengthens your position.
What rights do I have regarding the financing of a faulty vehicle?
Under consumer rights legislation, you are entitled to a vehicle that is of satisfactory quality and fit for purpose. If the vehicle is found to be faulty within a specified time frame after purchase, you may reject it and request a full refund. If more than 30 days have passed but less than six months, the dealer typically has one chance to repair or replace the vehicle. Prompt communication regarding any faults is crucial.
What procedures must I follow to reject the vehicle and terminate the finance contract?
To reject the vehicle and terminate the finance agreement, notify both the dealer and finance company in writing, clearly stating your intention to return the vehicle due to its issues. You have rights under consumer legislation that allow you to reject faulty goods within a specific timeframe. Keep all correspondence for your records, and if necessary, escalate the issue if the dealer or finance company does not comply.
Am I eligible for compensation due to the inconvenience and extra costs caused by the vehicle faults?
Yes, you may be eligible for compensation for the inconvenience and additional costs incurred due to a faulty vehicle. You could claim for any expenses directly related to the faults, including transportation costs. Maintain records of all related expenses and communicate clearly with the seller regarding your compensation claim.
What are the risks if I decide to stop making payments on the finance agreement while the issue remains unresolved?
If you stop making payments, the finance company may view it as a breach of contract, which could lead to repossession, damage your credit score, and legal action for any unpaid balance. It's vital to communicate with the finance company and dealer to reach a resolution. There are certain protections under consumer financing legislation that you could explore.
