Before you take delivery of your new lease vehicle from Nationwide Vehicle Contracts, you are entitled to a cooling-off period. But what exactly is a cooling-off period, how long does it last and how can you exercise your right to cancel?
To help explain how cooling-off periods work, Nationwide Vehicle Contracts has put together a short guide to answer all these questions and more.
What is a Cooling-Off Period?
Put simply, a cooling-off period is the period of time a customer (you) can cancel the purchase of goods or a service without incurring a penalty. It specifically relates to sales made at a distance, such as online, over the phone, or by mail-order. It also includes 'off-premises' transactions, for example, a face-to-face meeting that hasn't taken place on the traders premises.
Under the Consumer Contracts Regulations, any goods or services sold at a distance or off-premises are entitled to a minimum 14-day cooling-off period. During this time you can cancel your purchase for any reason and get your money back.
Your cooling-off period starts from the moment you place your order or enter into a contract – whether verbal or written – and lasts for 14 calendar days.
It is worth noting there are some circumstances where the Consumer Contracts Regulations do not give you a right to cancel. This includes if you went into the business’ shop or premises to arrange the service.
These rights exclusively apply to consumers (e.g. private individuals or partnerships with up to four partners), not businesses, such as Limited Companies, Limited Liability Partnerships (LLP) and Partnerships with more than four partners.
Why do Cooling-Off Periods exist?
Essentially, a cooling-off period exists to benefit the customer. It gives you a specific period of time to fully assess and investigate whether the product or service is right for you and to review any legal documentation or associated terms and conditions which apply to the product or service.
During your 14-day cooling-off period, it is advised that you use this time to make sure you are fully comfortable with the product, goods or service and any associated fees. For vehicle lease agreements, this includes ensuring this type of agreement is right for you, that the vehicle you have chosen fully meets your needs, and that you are fully aware of your obligations during the term of the contract. Also, that you are comfortable with the initial rental, monthly rentals and associated fees.
What Cooling-Off Period am I entitled to for vehicle leasing?
If Nationwide Vehicle Contracts is arranging your lease vehicle, there are two cooling-off periods that you need to be aware of:
- Your cooling-off period with Nationwide Vehicle Contracts (for our brokerage service)
- Your cooling-off period with the finance provider (for your consumer hire agreement)
Your cooling-off period with Nationwide Vehicle Contracts
The first cooling-off period relates to the period of time you have to decide whether or not you wish to use Nationwide Vehicle Contracts’ brokerage service.
In order for Nationwide Vehicle Contracts to broker the agreement between the you, the supplier and the finance provider, we charge a processing fee of £198 including VAT. This processing fee represents the costs incurred for arranging the sale, ordering the vehicle, arranging the finance and organising delivery of the vehicle.
In accordance with the Consumer Contracts Regulations, regulated credit broking agreements arranged by Nationwide Vehicle Contracts, that have been concluded without any face-to-face dealings (e.g. over the phone or online), can be cancelled without penalty and without giving any reason within 14 calendar days. This 14 calendar day cancellation period starts from the day you “accept” our quotation, Terms & Conditions and IDD document. For orders placed online, this period starts from the day you submit your online order.
This legal right applies equally to all regulated personal customers, sole traders and partnerships with up to four partners. Agreements for Limited Companies, Limited Liability Partnerships (LLP) and Partnerships with more than four partners are unregulated so therefore these rights do not apply.
Your cooling-off period with the finance provider
You also have a cooling-off period with your finance provider. This specifically relates to your cancellation rights in regards to the consumer hire agreement.
Once again, in accordance with the Consumer Contracts Regulations, regulated consumer credit agreements that have been concluded without any face-to-face dealings (e.g. over the phone or online) can be cancelled without penalty within 14 calendar days.
This 14 calendar day cancellation period varies from finance provider to finance provider, but typically starts either when the finance documentation has been issued by the finance provider or signed by the customer.
Most finance providers don't allow delivery of the vehicle until the ‘cooling-off’ period has expired. However, some allow delivery at the customer’s request, provided the customer signs documentation to declare they understand they still have the right to cancel, but if they do so within the cooling-off period they must pay for the value of the service provided up to the point they cancel. For example, if you were to take delivery of a vehicle then change your mind within the 14 day cooling off period, you must pay for collection of the vehicle and any usage.
What if I want to cancel during my Cooling-Off Period?
If you want to cancel your order within the 14-calendar day cooling-off period with Nationwide Vehicle Contracts, you will receive a full refund of your processing fee.
For consumers entitled to a refund of the processing fee, either in part or in full, refunds will be issued within 28 working days from the day Nationwide Vehicle Contracts receives the notification of cancellation.
What if I want to cancel after my Cooling-Off Period?
If you cancel outside of the 14-day cooling-off period, and your documents have not been signed, £50 inc VAT will be retained by Nationwide Vehicle Contracts to cover all costs and expenses incurred in arranging the credit hire agreement up to that point. This fee will be deducted from the £198 inc VAT processing fee (otherwise known as the brokerage fee) paid at the point of order.
However, if you cancel outside of the 14-day cooling-off period and your finance documents have already been signed, you’re not entitled to a refund.
How do I cancel my order?
If you wish to exercise your right to cancel, you must notify Nationwide Vehicle Contracts of your decision to cancel the contract by a clear statement in writing by post or via email to:
Nationwide Vehicle Contracts
Unit 9 Christie Way
Christie Fields
Manchester
M21 7QY
Email: [email protected]
You must include the follow details:
- your full name
- address
- details of the order you wish to cancel
Please note, by exercising your right to cancel, you are withdrawing from the brokerage contract and the contract is terminated. For consumers entitled to a refund of the processing fee, either in part or in full, refunds will be issued within 28 working days from the day on which Nationwide Vehicle Contracts receives the notification of cancellation.
If you have any further questions about our cancellation policy, please call us on 0345 811 9595 to speak to one of our leasing specialists.