Cheque from Motability for overpayment?

This topic contains 8 replies, has 4 voices, and was last updated by  Mike 1 year, 5 months ago.

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  • #68851 Reply

    Mike
    Participant

    I have received in the mail this morning a cheque from Motability for the sum of £42.00 which I wasn’t expecting. The accompanying letter has the proper Motability header etc,  has my correct customer reference number on it and is properly addressed. It is accompanied by a properly printed cheque.

    The accompanying letter just states it is with regards to an overpayment in connection with my lease extension (I extended the lease for upto 2 further years on my vehicle back in November after being messed about by dealers unable to fulfil orders). To quote from the letter ‘ The overpayment only affects the extended period of your lease. We have calculated that the amount you overpaid, and therefore the refund due to you is £42.00.

    The letter then apologises for having overcharged me.

    However I am not sure how I could be overcharged as the payments just continued as normal when my initial lease ended.

    Has anyone who has extended their lease recently had the same or similar?

    I will ring Motability later but was just trying to work out how this overpayment could have arisen.

    Thanks

    Mike

Viewing 8 replies - 1 through 8 (of 8 total)
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  • #68852 Reply

    Trev
    Moderator

    Not heard of this before Mike, though i wouldn’t worry and just bank it.

    I’m looking forward to receiving my post today now…. you never know lol


    Mota History - Nissan Qashqai Ford Focus Seat Leon ST Mazda CX-5

    #68865 Reply

    Mike
    Participant

    Hi trev, well I got the answer (eventually).

    As curiosity got the better of me and I contacted Motability when I got back from the hospital. I now have an answer although it has somewhat scrambled my brains (it took the Motability person, managers and the finance department about 30 minutes to work out what has happened). The cheque however is correct.

    What I was eventually told in a roundabout way is that the initial advanced payment on a Motability vehicle is amortised over the exact 3-year lease of the vehicle. Thus, when a contract is extended, from month 37 onwards the weekly lease cost falls into line with the basic PIP/DLA/AFIP rate, so everyone pays the same weekly rate to Motability.  Thus my payments have reduced by £7.00 per week.

    The £42 cheque I have received covers the six-week period from mid-November (when my lease was extended) to late December 2018 (during which time the full amount was taken, but it should have been reduced by £7.00 per week, hence the rebate).

    In future this overpayment will be returned to me quarterly by cheque (they cannot just reduce the Motability payment out of the allowance as that would put it onto ‘fixed payments’ basis and wouldn’t incorporate any annual increase – so would ‘technically’ put me in ‘arrears’ over the two-year lease extension).

    I will receive a quarterly ‘rebate’ cheque for £7.00 per week, until that is, the annual increase in April. Then it will go up slightly using the formula:

    (WPMS + Annual increase) minus (PIP + Annual Increase) = revised weekly ‘rebate’.

    Not only is it a logistical nightmare for Motability, but it has totally confused the hell out of me, albeit I think I now get the basic ‘gist’ of it all.

    It was apparently picked up ‘in an audit’ that WPMS recipients who extend their ‘total allowance’ contracts are overpaying when set against PIP/DLA/AFIP customers. Unfortunately Motability’s computer cannot cope with this at all. Hence it must take the full amount of WPMS from Veterans UK, then they have to manually work out the overpayment and manually raise a cheque to pay the rebate on a quarterly basis.

    So, for any WPMS recipients on here, if you have extended your Motability lease and have been continuing to pay what you were paying during your 3yr lease, you need to speak with Motability asap.

    What a logistical nightmare though.

    Still, it is better in my pocket etc. I clean forgot to ask if they will pay interest on my money that they are keeping but only sending me quarterly, but I think I will save that one for now!

    Mike

    #68869 Reply

    Trev
    Moderator

    Thanks for posting the explanation Mike – Yes what a nightmare, but good on them for being honest and getting you the money, as you say otherwise you would have been none the wiser.

    Me – I got 2 bills in the post today…….. so a good day for me being it was only 2 LOL


    Mota History - Nissan Qashqai Ford Focus Seat Leon ST Mazda CX-5

    #68874 Reply

    mitch
    Participant

    yes thats right i got a cheque oct before last as i had extended the lease by a year took me a while to work it out.

    but simply its because wpms is a higher amount. as you say the computer just says tilt to do it any other way.

    #68965 Reply

    Stewart

    I think we are all due an over payment cheque from motability.

    #68966 Reply

    mitch
    Participant

    a little unfair i think stewart, i havent found a single lease deal that matches motability when you add in insurance and the extras.

    #69049 Reply

    Matthew Daniel

    Hi Guys,

    I just received a £91 cheque also. Mine might be higher due to a high AP for the Volvo XC60 and my award is War Pension. Whatever the reason, the cheque is gladly accepted!

    #69053 Reply

    Mike
    Participant

    Hi Guys, I just received a £91 cheque also. Mine might be higher due to a high AP for the Volvo XC60 and my award is War Pension. Whatever the reason, the cheque is gladly accepted!

    Matthew,

    The AP paid is essentially irrelevant as it will have been amortised over the standard 3yr lease period.

    The £91 will relate to 13 weeks of overpayment at £7.00 per week. The £7.00 being the current weekly difference between WPMS and AFIP/PIP/DLA mobility allowances. It should rise very slightly with the annual increase in April, as WPMS (being a higher amount than AFIP/PIP/DLA) will gain slightly more with a percentage increase based on CPI.

    It is just a pity the Motability computer cannot cope with WPMS payments during a lease extension, thus they have to manually raise cheques every quarter. However, looking at it another way, it is a nice little ‘windfall’ every quarter.

    I am banking my cheques into a deposit account, so when the 2yr lease extension comes to an end it will be a nice little pot of circa £700 to put towards the AP of the next car on the scheme.

    Mike

Viewing 8 replies - 1 through 8 (of 8 total)
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