Returning a car to finance company...

koe_182

i've read about on this site regarding returning a car to finance companies. How does this work.

Basically had my car nearly 18months on a 36month finance agreement, i want to change the car and this appears to be the best way.

do you have to have a reason for doing it? what are the rules? how do i do it?

or would i be better trading it in?

the company is European Finance btw...

thanks

Idiophreak

Why don't you just give them a call, tell them that you want to change car and I'm sure they'll tell you your options...

koe_182

Idiophreak wrote: »

Why don't you just give them a call, tell them that you want to change car and I'm sure they'll tell you your options...

maybe, but are they not likely to shy away from offering me something that would benefit me more?

nomoneytoday

You can VT a HP deal once you have paid half of the debt. This might not be at month 18 though.

standupguy

European are a Finance broker but also have their own loan book.

First thing is to check the agreement to find out who the finance was with and make sure it is a HP agreement as different rules apply if it is a loan.

Phone the lender and ask for a settlement figure.

Get a value of your car for a trade sale, p/x or private sale?

If you have equity in the car - that is the value is more than the settlement - then sell and settle the Finance and pocket the difference or p/x at a dealer.

If you have negative equity, calculate how much you have paid so far - include any deposit and add up all the payments made to date
If this is equal to or more than the half HP price shown on your agreement then you can return the car to the Finance company under a voluntary termination.

If you have paid less than one half the HP price then you would also have to pay the difference to the half HP amount.