Land Rover Finance, can anyone help?

Newbie06

Hi All,
I am currently two payments behind with Land Rover Finance.

I recieved a "Notice of Sums in Arrears" dated 4th Feb. Arrears amount is £1,003.46

I have telephoned them to tell them that I have a new job starting 1st March and that I will be able to commence payments at the end of March when I get paid.

Their staff member told me that if I don't pay them the outstanding amount by 5th March, then I will not be complying with their default notice and that they will sell on my debt to an agency called Link and this will have a major effect on my credit rating.

I am not sure what is the best thing to do now.. Once the company Link have my debt will they be chasing me for payment in full or will I have an option to carry on installments. This is scaring me and I do not know what my options are or if I have any.

Please can anyone advise me?
Thanks,
Sally

petermb_2

How was the loan arranged? was it through the dealer?
did you include PPI, Gap insurances or breakdown cover?

Newbie06

Hi,
The loan was arranged through the dealers I have a HP Agreement. I didn't take out PPI or Breakdown cover but I do have GAP Insurance.

The dealers no longer exist - closed down.

Thanks,
Sally

standupguy

Is your agreement regulated or unregulated and therefore outside the CCA?

Newbie06

Hi,
It's a Hire Purchase Agreement Regulated by the Consumer Credit Act 1974.
Thx,

standupguy

ok, as they are not threatening repossession you must have paid over the half HP price?

If so you are in a position to voluntary terminate the agreement and return the car?

What is the car worth?

What is the current settlement figure on your agreement (you can telephone and get this from the Finance company)

If the car is worth less than the settlement figure then it may be in your interest to VT and lose the negative equity?

Newbie06

Hi,
I have paid over half, it's only the last two months payments I have missed.

The car is worth approx £8,000 and I owe £13,000 - I don't want to give the car up as I will still owe the difference and be without a car - which I need to get back and fore to work.

I will be able to pay for it as from the end of March so it seems silly to lose the car, but I am really concerned about the effect on my Credit Rating and what will happen when the company they sell the debt onto take over - will they try and force me to pay in full - which will be impossible..


Thanks for replying,,

standupguy

Wow, you have a golden opportunity here!

If you voluntary terminate the agreement, as is your right under the agreement, you will only have to pay any arrears at the date of termination as your outstanding liability. The agreement is then terminated and you have nothing further to pay.

You will save yourself in the long run - circa £5000 less the arrears of £1000 = £4000 saving.

You can then get yourself another car?

The arrears of £1000 would still be payable but that could be under arrangement with the Finance company.

If you still wanted to keep the car you could phone the Finance company and say that you are considering whether to voluntary terminate the agreement if they do not accept your proposal for payment - knowing that they then face a large loss if they take the car back they may well accept your proposal to pay.

You are in a strong position so do not let them dictate to you.

Newbie06

Wow, this sounds too good to be true!! Would they not chase me for the rest of what I owe?

Would my credit rating be affected??
Thanks,

standupguy

No, it's not too good to be true Sally - it is everyones right on a regulated HP agreement - read your agreement it sets out your rights to terminate the agreement and return the car - it is called the half rule in the industry.

Once you have paid one half of the HP price you can return the car and have nothing further to pay if your account is up to date
- if it is in arrears you will have to pay the arrears amount though and this can be paid after termination by arrangement as an outstanding liability on the agreement

A VT does not affect your credit rating but you may find future HP lenders ask for a bigger deposit in future so that they would not take a loss if you decided to VT a future HP agreement.

Newbie06

Thanks,
Basically, I would just owe them the arrears of £1,003.46 and the outstanding £13,000 would just be written off?? Sorry to keep asking, but I just want to be sure.

How would I go about doing this (sorry this is all new to me)...
Thanks again,