Ok, using the ‘reversed burden of proof’ technique it can be said that the car should have been checked fully when it was sold on. Pretty sure that unless they can prove they checked the belt and the tensioner and it was all ok, then they are liable. trouble is very easy for them to fake that history as will just be some internal paperwork.
However your strongest defence is the finance route. So push the finance comany into chasing. Also another tip is to makesure you back up all phone calls to the finance company with letters, always put it in writing. Also threaten them with the fact that you will not pay the interest o teh period you are without the car.
The other thing is the finance company will be regulated by the FSA so push them from the angle of you do not feel as a customer you are being treated fairly. Thats the FSA's buzz word this year,
I'm pretty sure even if you get them to meet half way, but thats a real bummer,
Oh and i know how you feel as i myself have just had to pay for a brand new engine in my mini, that was the best part of 3k so i know the feeling mate.