Fixed sum loan agreement - help please?

dubiousone

Hi all. Apologies for asking a silly question which is:-

Is a fixed sum loan agreemnet the same as Hire Purchase?

The reason I ask is of the common issue regarding losing the car. I initially thought it was on HP but I've found the paperwork which states it's a fixed sum loan agreement regulated by the consumer credit act 1974. We were able to keep the car with an IVA. Surely if it was on HP the finance company would have the right to repossess when we entered the IVA?

Can anyone help at all, knowledge appreciated!

peachyprice

Hi Dubiousone,
A fixed term loan agreement is not the same as HP, you own the car from the time you take out the agreement.

For BR the car is your asset and can be taken by the OR and the remainder of the loan goes into BR.

You were able to keep it in your IVA because the loan company was treated the same as all your other creidtors.

dubiousone

Cheers Peachy. The car is worth £1,500, when IVA was started the amount outstanding was £5,768. I've explained on my BR forms that the car is essential for work purposes, unsociable hours, no public transport at shift start and finish times, distance to work, unlit rural area which is not practical/safe to cycle or walk etc. Do you think there's a chance of keeping it then?

Thanks again!

peachyprice

As you know cars are the great unknown!

But as you need it for work and it's under £2k you certainly have a good case for the OR letting you keep it, but there are not guarantees.

dubiousone

I understand Peachy. I will just have to wait and see!

Thank you so much for your prompt reply and extensive knowledge!!:beer: