Car Loan - what happens if it gets written off?

louiseandwaynesmith · 26 February 2005 at 5:03PM

I am in search of some advice.

My husband and i currently have a car on finance with Black Horse finance. We are paying a huge amount of interest and would like to move it to a cheaper interest rate. On the same hand i need to by a new car in may due to my old reliable car not being worth repairing it for its next MOT. My husband has suggested that we put the two amount together (old loan and cost of nearly new car) into one car loan.

However, a couple of years ago, my husband wrote our old car off and the insurance paid up the value of the car at that date and then the additional insurance that we took out (costing £99) paid the shortfall of £2,750.

When we purchase my husbands car we took the additional insurance out again, just incase!

However, if we were to put our two amounts together and then one of us had our car written off, what would the additional insurance pay out for?

Hope someone can help.

flea72 · 26 February 2005 at 5:28PM

really depends on the redemption terms of your blackhorse loan - usually it isnt worth moving, as they charge so many fees, etc, that you dont save anything

as for the shortfall cover you purchased, i would assume that would be cancelled, if you paid off your existing loan, as the two are normally tied - you have the option to take out this cover with your new proposed loan, but i would say that it only relates to one vehicle unless you paid for it on both

louiseandwaynesmith · 26 February 2005 at 5:50PM

Thanks very much for the information.

Looks like i will be shopping around for my loan and shortfall cover before i buy my car.

Car Loan - what happens if it gets written off?

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