Car Finance Advice

Due to the change in my financial circumstances I need to sell my car which is on finance with two years remaining. The only problem is due to the economic down turn my car seems to have depreciated a lot more than I would have expected.

So I owe more than it’s worth, is there any way of getting rid of it or am I stuck?

If I sell it privately, I won’t get anything close enough to what I owe.

Have you made payments totalling more than half of the finance agreement?

Yes, I will check when I get home but I’m pretty sure I have.

do you care about your credit rating?

do you care about your credit rating?

No, not really.

depends on your original finance deal.

Some deals have a clause where you can just hand the car back with nothing more to pay; how you get home is your problem…

Would getting rid be sound economically? Would you still have to find money to pay off the balance? If so, would you be better hanging onto it & riding the storm. Another 18 months & you will no longer be in negative vehicle equity…

I’m probably best keeping it for another year then sell. I can ride the storm but I’d rather spend/save my money that I’m paying out every month.

do you care about your credit rating?

Thats a threat used by the ‘interested parties’.

Look closely at the small print there should be a break-clause (usually halfway) where you can surrender the car. Speak to your CAB. They may be able to provide you with a template. My Bro in law surrender two cars at the halfway point. Gave them a letter saying ‘I will be handing back my car etc etc’ and they simply asked him to drop it off at a Auction house.

Its worth looking into. Plus, SERIOUSLY dont ask the finance company etc advice- get independent advice.

This might help – not sure but good luck:

http://www.pistonheads.com/xforums/topic.asp?h=0&f=23&t=633614&nmt=HPI%20agreement%20on%20car-%20can%20friend%20hand%20car%20back%20now?

If you paid for the car on hire purchase (HP) then you are perfectly entitled (no small print clauses) to hand it back when the total repaid (including the deposit) is half or more the original purchase price (less any accessories). They are entitled to ake deductions for excessive wear and tear/damage, but not for excessive mileage.

If you bought it on a loan, then there is no recourse whatsoever as far as I am aware.

I did the same a few years ago – just signed a form and gave them the keys. Went out and bought a brand new, better car for the same monthly repayments over just one year more term than I had outstanding – simply by getting a car on a much, MUCH better finance rate (I was rammed unmercifully on the first tbh, but I was young and stupid).

Have a look at your finance agreement, typically around section 11, it will state at what point into your finance agreement you are allowed to return the car to the suppliers (Supposing they still exist) or the finanace company.

Absolutley no come back what so ever if you meet the requirements.

Also remember that if you do this and if you took it out cancel all payment protection and GAP insurance you have otherwise this will continue to be taken from you account.

Alot of lease companies are obviously struggling at the moment. They’ve based their figures (profit) based on the supposed residuals at the end of a cars term. With values dropping below their expected you could receive bullying calls/attitude etc!