Ending a lease two months early

10
Found 3rd May 2017
I am genuinely baffled by an email I have had from Arval, I had a lease car for 24 months at 15,000 miles a year (at a rate of £0.04 per excess mile), I extended it for 12 months. I am 10 months in to that extension and I've been offered a great deal on a used car that is time sensitive, so I've decided to buy that used car and seeing as I'm already at 45,000 miles, I thought I'd settle up and send that car back early avoiding a service and MOT as well as the £50 a month insurance for an unused car.

I guessed that they would charge me for the two months remaining on the contract (£150 per month) plus an extortionate admin fee of about £200, so £500 in total, which would be alright by me. So they send me an email with a pdf quote on it for an "Early termination estimation" of £1,259... but then the email says the following:

"- Please be advised that the attached PDF Early Termination Estimate is system generated and can not be amended, please see below your Early Termination Estimate.

Important – Please note the following:-
• The ‘Estimated cost to Early Terminate’ is before VAT. (i.e. VAT will need to be added)

• In addition to the ‘Estimated Cost To Early Terminate’, Arval may also invoice you for Excess Mileage. Arval shall calculate the amount by which the Actual Mileage exceeds the Pro Rata Contract Mileage and multiply this figure by the appropriate Pence Per Excess Mile. Any charges for Excess Mileage will be invoiced in accordance with the terms of your agreement with us.

• Your rental period runs from 21st of the month to 20th of the month. If your vehicle is returned before the rental period date start then the Early Termination cost will be £122.82 + VAT (providing May’s monthly rental is paid).

This is the equivalent to the outstanding rentals on your account plus an additional Early Termination fee of £25.00 + VAT which is a contractual charge.

If you wish to continue with returning the vehicle then you will need to sign the attached Early Termination paperwork. Once the vehicle has been collected and terminated you will then receive an invoice stating the full Early Termination charge.

On receipt of this if it is more than £122.82 + VAT (providing May’s monthly rental is paid) then please contact us and we will arrange for the invoice to be placed into dispute whilst the necessary credit for the difference is being processed. You will then only need to pay the remainder due and the contractual £25.00 + VAT Early Termination Administration fee."

I've asked them to tell me in plain English how much it is going to cost because that email says it should cost about what £300 tops? But the estimate on PDF is for £1259 so which is it!

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10 Comments

It's an estimate that presumably guesses excess mileage etc, not the definitive final charge?

Are you on your 34th month and was the 12 month at the same contracted rate as the original deal?

Are you able to add the PDF quote as it may help - obscuring any personal details.

What does the agreement state for termination fees on the 12 month contract extension?

Original Poster

windym

Are you on your 34th month and was the 12 month at the same contracted … Are you on your 34th month and was the 12 month at the same contracted rate as the original deal?Are you able to add the PDF quote as it may help - obscuring any personal details.


https://rapidnews.box.com/shared/static/dy3epprc5mvv1ci11yzf2oelzde01dec.jpg

Is there any more 'small print' with the estimate?

Original Poster

windym

Is there any more 'small print' with the estimate?



Not on the estimate. On my contract. There is this:


4. EARLY TERMINATION OF CONTRACT HIRE VEHICLES
4.1 At any time after the Minimum Term the Hirer may elect to terminate the hire of the Vehicle before the end of its Contract Term. The Hirer must give ARVAL one month's notice in writing of the date the Vehicle will be available for collection and the Contract Term will terminate on the date the Vehicle is made available for collection.
4.2 The Hirer shall not be entitled to a refund of any Rentals paid in advance (and amounts invoiced shall remain due) even though relating to a period following the date of termination. In the event of early termination ARVAL shall undertake a reconciliation to determine the difference between the net resale proceeds and the ARVAL Written Down Value at the date of termination, plus ARVAL's standard early termination administration fee plus VAT. Where a charge results from the reconciliation, ARVAL will invoice the Hirer and the Hirer shall pay in accordance with Clause 3 of this Agreement.
4.3 Where this Agreement terminates at any time before the expiry of the Minimum Term, the Hirer shall, in addition to any amounts payable under Clause 4.2, pay ARVAL any unpaid Rentals for the unexpired Minimum Term.

I think the estimate is just to outline there will be fees to pay, when they say it can't be amended, it's clear they are giving you that as a guideline and your actual quote is the email.

Please be advised that the attached PDF Early Termination Estimate is … Please be advised that the attached PDF Early Termination Estimate is system generated and can not be amended, please see below your Early Termination Estimate.



From those figures I can see I would expect you to have to pay:

£150 month 11 rental.
£150 month 12 rental.
£122.82 if May's rental is paid and the car returned in the timeframe given.
£100 - 2500 excess miles charged at £0.04
£25 Early termination fee.
Vat on everything (20%).



Original Poster

windym

I think the estimate is just to outline there will be fees to pay, when … I think the estimate is just to outline there will be fees to pay, when they say it can't be amended, it's clear they are giving you that as a guideline and your actual quote is the email.From those figures I can see I would expect you to have to pay:£150 month 11 rental.£150 month 12 rental.£122.82 if May's rental is paid and the car returned in the timeframe given.£100 - 2500 excess miles charged at £0.04 £25 Early termination fee.Vat on everything (20%).




Thanks for your help

Why don't you simply phone and ask them to explain?

I would ask for an accurate invoice based on dates of termination you specify. Don't take an email as an invoice. If it's not an accurate reflection of what you owe don't accept a rebate to compensate. As there is no benefit to paying you in a timely manner. I had this with an expensive fitted wardrobe. Write to them send recorded a statement saying your invoice is wrong and nothing will be paid until an invoice that reflects the actual money owed.
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