Skoda VW New Car PCP Loan and death of owner

Matthew_Hall · 20 April 2017 at 1:13PM

Hi,
Sorry if this is in the wrong place, but I really need some help.
My father in law has just died (his wife is the executor).
He had bought a new skoda yeti on PCP and had it appprox. 6 months and made approx 6 payments (currently we have suspended payments, this may be a mistake).
He paid 4.5K deposit on car value of car approx. 24K.
VW finance are asking for 6k from his estate (money that his wife, my mum in law obviously needs) this seems steep and rather mercinary in the situation.
I believe we can sell the car privately to pay of the balance, but not sure how this works, would we in effect have to buy the car first?
We have been told that someone could continue the deal but no one is in the place to do this.
It seems a bit steep that VW get 4.5K + his payments and the additional 6K,that's approx 12K and they get the car back.
Any advice? We have skied for the settlement details to be sent through but they have yet to arrive.
Thanks in advance,
Matt

bengalknights · 20 April 2017 at 3:09PM

Although the car cost 24k whats the interest being charged on this 19k outstanding, have the given a breakdown or statement of account?

lopsyfa · 20 April 2017 at 4:44PM

You don't have to buy it first but it will be difficult to sell it to an individual. THPI check will show the outstanding balance and the person buying it can't be sure the finance will be settled once he bought the car.

The best thing is to request a settlement figure from VW finance and then sell the car to a dealership (such as Evans halshaw, wewantanycar, webuyanycar, sytner etc) who will settle the finance and then pay you the difference or you give them some little money depending on the car depreciation (which should be a lot less than 6k). Tell your mother in law to get quotes from these companies and more and then pick the best price to settle the finance.

That is what I did when I sold my VW Golf financed with VW Finance in December last year.

Matthew_Hall · 20 April 2017 at 5:29PM

Thank you for the advice, hopefully we will be getting costs breakdown soon.

Matthew_Hall · 20 April 2017 at 5:33PM

Thanks for the info. The VW financial lady implied that they have not returned much interest in the car so far and that it why the settlement was at 6k. Thanks for the info on how you settled you finance that sounds promising, maybe Evans Halshaw might be a better option compared to the 'we buy anything ones' I've felt they've always tried to pay the bare bones.

Nearlyold · 20 April 2017 at 6:01PM

I don't think 6K was a settlement figure I think its the further amount you would need to pay in order to hand the car back under Voluntary Termination. basically once you have paid 50% of the total amount payable you can hand the car back without additional liability other than charges for damage beyond fair wear and tear.

If the deposit was 4.5K and there have been 1.5K of payments the settlement figure is going to be a minimum of 18K depending on the interest rate (though from your figures I wonder if it was a 0% deal).

Bearing in mind that VAT on the car would have been £4,000 I'm afraid that its likely even with a good offer from a buyer the estate is going to have to find (assuming there is sufficient in the estate to do so after funeral and testamentary expenses) some funds to clear the debt, though this should be less than the 6K required if you went the Voluntary Termination route

lopsyfa · 20 April 2017 at 6:19PM

As mentioned by NearlyOld, the £6k is the amount you need to pay to voluntarily terminate the finance and hand over the car.

The other option I suggested above will most likely leave you in better financial position. You can always settle the finance at any time with VW finance. Call to ask for the settlement figure and go from there.

Matthew_Hall · 20 April 2017 at 8:03PM

You are correct I have been misinformed and it was a 0% finance.
Thanks for the info.

Thank you all for your advice, if anyone has anything Elise please feel free to add.

Sorry I haven't been able to reply directly to each, this forum is a little different to others I've used where a quick reply normally shows who I am replying to.

Smylee · 4 August 2017 at 6:20PM

Hi
This happened to me when my brother died suddenly in 2015. As the sole beneficiary and executor of his will I had to contend with the following.
He had bought a new Skoda Rapide November 2014 he died suddenly May 2015 6 months into the contract. The car had only 600 miles on the clock.
Skoda Finance (VW) gave me the following 3 options: and 14 days to choose!
1. Buy the car from them for £12563
2. Take over the payments £199 per month
3. Let them sell it at auction (take pot luck).
In the end I sold it back to the original dealer for £9500 and paid the £3063 difference.
I had no car and £3063 out of pocket
Skoda Finance (VW) only cared about getting their money. There was no compassion when dealing someone who was grieving and in shcock.
Think very carefully if you consider a PCP. How would you or your family cope if you died?

Nearlyold · 5 August 2017 at 11:24AM

Smylee wrote: »

Hi
This happened to me when my brother died suddenly in 2015. As the sole beneficiary and executor of his will I had to contend with the following.
He had bought a new Skoda Rapide November 2014 he died suddenly May 2015 6 months into the contract. The car had only 600 miles on the clock.
Skoda Finance (VW) gave me the following 3 options: and 14 days to choose!
1. Buy the car from them for £12563
2. Take over the payments £199 per month
3. Let them sell it at auction (take pot luck).
In the end I sold it back to the original dealer for £9500 and paid the £3063 difference.
I had no car and £3063 out of pocket
Skoda Finance (VW) only cared about getting their money. There was no compassion when dealing someone who was grieving and in shcock.
Think very carefully if you consider a PCP. How would you or your family cope if you died?

The issues that arise on the unfortunate death of a borrower are not unique to PCP's, the need to repay the loan from the estate arises with any form of borrowing. An executor does not have to repay the loan from their own funds of course.

jls · 11 January 2018 at 8:38PM

I have today been asking myself the very same question as I am about to order a Skoda through PCP, and was researching what the implications were of the death of the contract holder.

I know this does not help those already in such a position, but the advise I had read so far is that if about to start such a lease plan and both husband/wife are alive than the contract can be established on a joint basis.

This may not suit everyone, but would allow the lease to continue with the remaining spouse taking over remaining payments.

This would give more flexibility as to any decisions/timing of terminating the lease, and possibly reduce any 'large' termination payments.

jls

Skoda VW New Car PCP Loan and death of owner

Comments

Categories

Get our FREE Weekly email full of deals & guides - and it’s spam-free