MTF and what anyone with finance needs to know!

[fizbin]

Well as some of you know, I managed to drop and write off my bike a couple of weeks ago! :whocares: my fault entirely, pilot error what ever you what to call it but basically i fucked up.
So i bought the bike through Mt Eden Motorcycles not without its dramas but happy with the result. I financed the bike through MTF Finance and also took out "Platinum Payment Wavier Insurance" which as i understood it meant that if i wrote the bike off before i had paid it off, and there was an amount that my insurance didn't cover this cover would step in and cover the short fall. I had had this on my previous bike and thought this was a good idea.
Now i paid $779 for this cover not cheap considering that this is in the finance package and i paid 19.25% interest over 36 months for this.
So i wasn't worried about the fact that i had the bike for only a year or so, i had all this cover which meant i should not end up owing anything on the bike right?!?! umm NO!:gob:

To explain:
I am comprehensively insured through Lumley Insurance (not the cheapest option but i get a good deal with my wife working there) had no problem with the claim it was accepted with no problem excess paid and money paid to the finance company. I send all the information off to the finance company making sure not to miss anything so that we don't get any delays as i am paying $87.27 weekly even though i don't have a going bike anymore.
after giving them a couple of days to process the paperwork i ring them to check that they didn't need any more information... No they had all the info they needed and would give me a call back that day.
So about 4:45pm i miss a call from them as i was driving home not too worried as prob just to tell me all good right?
Nope! I phone them the next morning, yes claim has been accepted for the payment waiver insurance, amount owing on the account $1200 and something. we are paying out $850 or something like that. Hang one i say to them but i paid for platinum cover that should pay for everything right? No not so, they will pay for everything accept for the termination fee that they are charged for me closing the account early. What! you mean i am still going to owe money? Yep $519.10: :blink::shit: FFS
After 4 phone calls to Christchurch i am pointed to the clause in my contract:

‘Vehicle Finance Payout’ means the amount owing by you under this Contract at the date of payment of the Total Loss claim, less any arrears, any default interest, any late payments, any payment for MTF's loss on an early repayment, any rebatable items, any additional interest and any amount of increased liability where there has been a variation to this Contract.
‘Vehicle Insurer’ means the insurance company named in the Comprehensive Motor Vehicle Insurance Policy.

So i phone Mt Eden Motorcycles and ask What the fuck where did this charge come from! Talk to one of the sales people there who was unaware of the charge. but could agree that this does seem high. A little while later i was surprised to get a phone call from Chris, the managing director from Mt Eden, now i have never met Chris but after talking to him and clearing up a couple of things he was concerned about, we both agree that although Mt Eden was aware that there would be a charge for this, $500 odd was a bit exorbitant.
Next mike (Who sold me the bike) calls very concerned, because he was also aware of this charge but like Chris was very surprised at the amount that was charged. obviously nothing they could do for me really but it was nice to get the phone call, and for them to fax me a copy of my purchase agreement.

So after a couple of phone calls to my wife (works in insurance!) I come to the conclusion that o.k. i wasn't aware of the charge but it is in black and white i have to pay for this. although i don't think that the fee is a "fair and reasonable" fee as their motto states all their fees will be i have no choice but to pay for this. :angry: but as my wife's boss said they may not be morally right but they have done nothing illegal.

So i ring MTF back and said basically look i have no problem paying for this charge as in clause blah blah blah i am under obligation to, but as i am now running my car to and from work my gas costs have risen from $30 per week to $120 per week. Could i look at paying this off over a slight longer period to make the payment and my gas bill more manageable? They reply with sure not a problem at all you can pay it off over 12 weeks oh but wait we will be charging you another $150 in interest to do this. :crazy::eek5:
I hung up after trying to reason with them on this because i was so mad!

So after another very irate call to my wife and some soothing and helpful advise (Mrs Fiz I love you honey:love:) i call them back and ask to speak to someone more senior than the call center people i have been dealing with.
"ok sir we will get Mrs X to call you back in 10 mins"
4 hours and a couple of phone calls later i finally get to talk to some person who after a 40 min phone call agrees to let me pay the now $436.83 off over a longer period at a lower rate and not charge me any interest on that figure as she herself conceded that the figure is high.
RANT OVER!:shutup:

The whole point of this thread started to, as the title states, warn anyone that might have taken finance and the payment waiver insurance out with MTF like me, that you could be in for a massive shock when you come round to claiming on this.
Hence i will not be using MTF for my next bike!

[Mrs Fiz]

As someone who works in the insurance/finance industry...
Legally, MTF have done nothing wrong. Fizbin signed the contract and the clause was there in black and white. That's why you should all read the small print. Now, we know that realistically you're going to be thinking 'blah blah blah, shiny new bike, blah blah blah'. Without sounding like a nana (or someone's nagging wife!!) make sure you understand what you sign, before you sign it. But let's be honest, you'll probably still sign it, regardless of the clause. After all, there is a shiny bike to consider. But at least you'll be forewarned and won't get a horrible shock like Fizbin did.
Secondly, if you don't understand, or it isn't clear how MUCH a fee might end up being...ask. They're legally obliged to help you understand the contract. If you don't understand it, don't sign it. If you don't want to sound like a doofus, ask a friend who might know what they're talking about. You've got practically unlimited resources in this forum. Ask someone here. Guaranteed someone will know it means. And if you didn't know, chances are extremely high that at least 25 other people didn't know either.
Okay, nagging wife, signing out. :)

[discotex]

Here's a free tip.

Pay cash for depreciating assets - especially ones that can become instant scrap metal.

EDIT: that's not meant to sound condescending btw.

[Mully]

Thanks for the heads-up. Gutted on your behalf though.


and i paid 19.25% interest over 36 months for this

19.25%!! Fucken OUCH!!!!

[Mully]

Here's a free tip.

Pay cash for depreciating assets - especially ones that can become instant scrap metal.

EDIT: that's not meant to sound condescending btw.

That's true, but in his defence, he thought he was covered for this.

I guess another free tip is: Read the Contracts.

[Fatjim]

Discotex, why?

[jrandom]

Pay cash for depreciating assets...

Leasing works well in certain contexts, too.

[discotex]

Leasing works well in certain contexts, too.

Totally... Particularly if you own your own business then breaking up the total price into a fixed monthly fee helps manage cashflow and accounting. Of course someone other than you usually makes money out of the deal or they wouldn't do it.

[DMNTD]

Of course someone other than you usually makes money out of the deal or they wouldn't do it.

Buy it personally and lease it to your own Co. ?

[Mully]

Buy it personally and lease it to your own Co. ?

Hmm, now that's an idea.

[vifferman]

Whelp, I paid for half of my current bike with a trade-in, one quarter with the credit card (paid off each month, no interest), and the remaining quarter on MTF, just for convenience. The interest was some piddling amount.
I was happy enough with how it all worked out that I'd do it again.

Now GE Money is a completely different kettle of fish...

[discotex]

Discotex, why?

Because you lose more money more fasterer. Especially if you damage the bike and then have to then sell/trade/write-off for less than the loan. Even if you insure against that scenario like fizbin did you're paying even more cash for nothing on top of the interest.

Using debt for toys = bad
Using debt for assets that make you a profit = good

That said there are always possible scenarios where it could work out better depending on how much finance you use and what the interest rates do.

And, of course how much joy you get out of your toys may make it worth it whatever the cost.

[Mully]

Now GE Money is a completely different kettle of fish...

Ohhh, I hates them, I hates them like Mr T hates Jibba Jabba.

[discotex]

Buy it personally and lease it to your own Co. ?

I'm no accountant but it's probably easier to just buy cash as the business and depreciate the asset and claim expense as per the tax rules at a guess.

[discotex]

Whelp, I paid for half of my current bike with a trade-in, one quarter with the credit card (paid off each month, no interest), and the remaining quarter on MTF, just for convenience. The interest was some piddling amount.
I was happy enough with how it all worked out that I'd do it again.

Now GE Money is a completely different kettle of fish...

A perfect example of what I mean by it can be worth it whatever the cost. Having the bike you want can be priceless and if you walk in eyes open it's all good.

I just get tired of hearing 20somethings whinge about being screwed by GE when they signed the freakin contract for the 32inch LCD that is now worth fuck all and they still have 2 years left of payments.

Shit I must be turning into an old man :crazy:

[Mully]

I just get tired of hearing 20somethings whinge about being screwed by GE when they signed the freakin contract for the 32inch LCD that is now worth fuck all and they still have 2 years left of payments.


Sorry to drag this further off topic, but I actually had a similar conversation with a mate of mine on Tuesday. We marvelled at the damage easy credit has done to the economy.

He's not old (just turned 40), but when he bought his first house, his bank manager made him sign a contract to save XX dollars per month on top of his mortgage payment. He reckoned it sorted him financially from day one.

[Badger8]

Eurgh, yet another reason to hate finance companies.
Personally, i've never used one and am in no hurry to.

Now before you jump to conclusions, i dont have money flyin outta my arse, and i work very hard to get my toys. I just chose to go via the bank rather than finance companies. Plus i never get 100% finance / loans on stuff. Always get a decent deposit together out of what little savings i can muster, and get a personal loan for the rest. Much better terms and rates, and when i get a shitload of overtime in a period and wanna wipe a grand off the loan, no worries. if i save up enough to write the last of the loan off 3 months early, no worries. Have always done it this way for anything i've needed extra dosh for, and never had any troubles. Used to be on a graduate account, so got cheap loans, but not so anymore unfortunately. Still better off than finance companies from my experience tho :)
One little tip tho, make it an un-secured personal loan. If you tie the loan to the toy, you can find yourself in trouble if you come to sell it or something goes awry as in this case.

Read it carefully next time fizzy! :yes:

[Mom]

Now GE Money is a completely different kettle of fish...

Pack of theiving, lying, dishonest scum... shit you got me started :mad:

[disenfranchised]

Hmmmm, Both the wife and I used MTF through Red Baron when buying our bikes.
Interest was around 13-14% somewhere, and the early pay off fee was specifically mentioned to be just $50 (although I don't know if that's in writing)
Haven't tested that out yet. My bike is almost paid off now, so i'll never do it, but we were thinking of paying of the wifes early.
I'll be double checking any fees before we do now....cheers for the heads up.

[Mystic13]

Hmmmm, Both the wife and I used MTF through Red Baron when buying our bikes.
Interest was around 13-14% somewhere, and the early pay off fee was specifically mentioned to be just $50 (although I don't know if that's in writing)
Haven't tested that out yet. My bike is almost paid off now, so i'll never do it, but we were thinking of paying of the wifes early.
I'll be double checking any fees before we do now....cheers for the heads up.

I'm guessing that as with all money people the early payoff fee is proportional to the difference between what theyw ere getting for money and what they are getting for money.

Retail banks have the same thing. You have a fixed interest mortgage at 10% on $100,000 with one year to run. Means the bank will earn $10,000. If you kill it and they can only lend at 6.4% that means they'll only earn $6,400. So what they want from you is the difference that they'll be out of pocket by or $3,600ish. That's why we've seen termination fees of in excess of $10,000 from retail banks.

I wonder how much MTF interest had changed?

[Mystic13]

So i phone Mt Eden Motorcycles and ask What the fuck where did this charge come from! Talk to one of the sales people there who was unaware of the charge. but could agree that this does seem high. A little while later i was surprised to get a phone call from Chris, the managing director from Mt Eden, now i have never met Chris but after talking to him and clearing up a couple of things he was concerned about, we both agree that although Mt Eden was aware that there would be a charge for this, $500 odd was a bit exorbitant.
Next mike (Who sold me the bike) calls very concerned, because he was also aware of this charge but like Chris was very surprised at the amount that was charged. obviously nothing they could do for me really but it was nice to get the phone call, and for them to fax me a copy of my purchase agreement.



So Mt Eden Motorcycles said "Yep we knew and didn't tell you but we didn't think it would be much". Sure it was in the fine print. But if they knew and decided not to tell you I'd be asking Chris for a contribution.

Sure they're a small place and nice people but we're still talking $436.

Chris, mate, Here's the deal. Your guys knew about this and they've acknowlwedged they didn't tell me about it and I don't think that's fair. In future I think you guys should be letting folks know about it. I see now it is in the fine print but I wouldn't have understood that and your guys said nothing. So what I'm here for is a contribution from your company to the cost of $436. (Now if you intend to buy another bike from them I'd ask for the $436)

At this point my thoughts are taking this to the disputes tribunal (and in my experience you'll be awarded more than $436) or sitting down and resolving this with you guys. Chris I'd like to have you pay the $436. Are you comfortable with that in this case to settle this in good faith.

I expect Mt Eden to come to the party and if not I would make a claim. There are clear rules about misleading and if they knew and said nothing their silence is not a good look.

______________________________

Secondly I'd also look at the MTF thing. I can understand a higher fee if there has been a significant shift in interest rate. (the bugger is when the rate goes the other way they never pay you). So what is the current MTF rate compared to what you had. Also are you making a payment to MTF for the total of all monthly payments and all interest. So if you worked out the monthly payments you had left and totalled them what you pay MTF in final settlement of the loan plus the early termination fee should not exceed that and should be a good way under. My concern is MTF using this to gather extra funds to help the business.

My concern would be to make sure I wasn't being taken by MTF. Disputes tribunal is still a good place to sort this as well.

_______________________________

And if nothing else, staying calm and digging further won't see you lose any more money but may get some back.

Cynically you could say you got the call from Chris because Mt Eden Motorcycles stuffed up, and wanted to cover butt, not because it was a good customer service thing.

[discotex]

Actually Mystic13 has a very good point. Great customer service is not explaining why they can't do shit to help you.

That clause is pretty vague and if you were sold that extra cover on the promise it would cover you fully there is a case that Mt Eden have breached the fair trading act.

"We didn't think it would be that much" means they have obviously been misleading people when selling this product. In that case they should carry the can regardless of who signed what as you can't contract out of the fair trading act.

As the people who arranged your finance I'd be telling them they won't be seeing the $$ for my next bike unless they come to the party and help out.

[fizbin]

So Mt Eden Motorcycles said "Yep we knew and didn't tell you but we didn't think it would be much". Sure it was in the fine print. But if they knew and decided not to tell you I'd be asking Chris for a contribution.

Sure they're a small place and nice people but we're still talking $436.

Chris, mate, Here's the deal. Your guys knew about this and they've acknowlwedged they didn't tell me about it and I don't think that's fair. In future I think you guys should be letting folks know about it. I see now it is in the fine print but I wouldn't have understood that and your guys said nothing. So what I'm here for is a contribution from your company to the cost of $436. (Now if you intend to buy another bike from them I'd ask for the $436)

At this point my thoughts are taking this to the disputes tribunal (and in my experience you'll be awarded more than $436) or sitting down and resolving this with you guys. Chris I'd like to have you pay the $436. Are you comfortable with that in this case to settle this in good faith.

I expect Mt Eden to come to the party and if not I would make a claim. There are clear rules about misleading and if they knew and said nothing their silence is not a good look.

______________________________

Secondly I'd also look at the MTF thing. I can understand a higher fee if there has been a significant shift in interest rate. (the bugger is when the rate goes the other way they never pay you). So what is the current MTF rate compared to what you had. Also are you making a payment to MTF for the total of all monthly payments and all interest. So if you worked out the monthly payments you had left and totalled them what you pay MTF in final settlement of the loan plus the early termination fee should not exceed that and should be a good way under. My concern is MTF using this to gather extra funds to help the business.

My concern would be to make sure I wasn't being taken by MTF. Disputes tribunal is still a good place to sort this as well.

_______________________________

And if nothing else, staying calm and digging further won't see you lose any more money but may get some back.

Cynically you could say you got the call from Chris because Mt Eden Motorcycles stuffed up, and wanted to cover butt, not because it was a good customer service thing.

Thanks for the advise :)
I will not be taking this any further as it stands, i would like to see someone come to the party here as like you said this is a lot of money for me, but at the end of the day i am not unhappy with MT Eden.
It was my own stupid fault for not reading the contract correctly in the first place! Even if (and i am not saying they did) Mt Eden did not explane this clearly to me, like my wife says, guy telling me the in's and out's of a contract... shinny new bike... blah blah blah... shinny new bike!
Basically i am going to pay the amount off as quickly as i can get my full license and go out and buy a new bike. but this time i will not be using MTF and i would suggests that no one ever does.

[jrandom]

... this time i will not be using MTF and i would suggests that no one ever does.

That's probably a bit unfair. As you've said, the "early repayment cost" clause and its potential interaction with writeoffs under your insurance policy was all there in writing, but you failed to read and understand it before signing.

Right now MTF are having to operate in the same difficult conditions as every other finance company. I've financed a couple of my bikes through them and had good service and reasonable terms.

[FROSTY]

That insurance is called GAP insurance.The story you are telling is exactly why I'm not with MTF or Lumley.
The whole point of GAP was just wasted.
Folks its really well worth checking out the numbers before taking GAP
If its gonna cost you $1000 for gap but the insurance co values your bike only $1000 below what you are paying then its a waste of money.
Keep in mind too thay yes its a devaluing item but you are also paying it off the two cancel each other out

[fizbin]

That's probably a bit unfair. As you've said, the "early repayment cost" clause and its potential interaction with writeoffs under your insurance policy was all there in writing, but you failed to read and understand it before signing.

Right now MTF are having to operate in the same difficult conditions as every other finance company. I've financed a couple of my bikes through them and had good service and reasonable terms.

O.K. i do conceed that point however i still wont be useing them. it did take me to many phone calls to get a result that everyboday was happy with.


That insurance is called GAP insurance.The story you are telling is exactly why I'm not with MTF or Lumley.
The whole point of GAP was just wasted.
Folks its really well worth checking out the numbers before taking GAP
If its gonna cost you $1000 for gap but the insurance co values your bike only $1000 below what you are paying then its a waste of money.
Keep in mind too thay yes its a devaluing item but you are also paying it off the two cancel each other out

hey frosty
the reson i took the gap insurance out was that by the time i financed my bike and gear..ect i ended up with around $12k to pay, way more than the bike was worth. still that was a choice i made at the time of pruchace.
The reason i am with lumley is a couple of reasons
1 my wife works there so i get looked after really well
2 i have never had an issue with lumley. after coming from State insurance i can definatly say that lumley is far easier to deal with. Even though i was my fault this time, it took 1 phone call and 1 fax and the claim was accepted and paid out in roughly 1 week.
Yes they ar e more expensive than other insurers but at the end of the day somthimes cheaper is not the best option.

[FROSTY]

Sorry Fiz--- Im talking about the Finance and Gap side of things. Not normal insurance
Wont deal with MTF because of the clawback and deal with Autosure for their Gap.

[Forest]

Leasing works well in certain contexts, too.

Unfortunately it is effectively impossible to lease a motorcycle.

[jrandom]

Unfortunately it is effectively impossible to lease a motorcycle.

O RLY?

Give Dave Anderson MC/Alltrax (http://www.daveanderson.co.nz/) a call. Their main business is in farm equipment, I think, but they'll also lease Suzuki road bikes if you ask nicely.

It's worked very well for me so far.

:niceone:

[kiwifruit]

O RLY?

Give Dave Anderson MC/Alltrax (http://www.daveanderson.co.nz/) a call. Their main business is in farm equipment, I think, but they'll also lease Suzuki road bikes if you ask nicely.

It's worked very well for me so far.

:niceone:

me too! (http://www.bikepics.com/pictures/1604809/)

:sunny:

[Forest]

O RLY?


That's interesting. The feedback I was given is that leasing companies don't feel comfortable about estimating used bike prices three years ahead of time time, so they restrict their offerings to vehicles with established secondary markets.