Calculating PCP Car loan Termination costs

joecocker

Hi, I am looking to terminate my PCP car loan early, I have paid 18 months of a 36 month PCP deal.
Total Loan £15k
Paid to date £4748
Balloon amount £4800

I have been told I need to have paid 50% 0f the loan before I can do this.

I want to know if you take the balloon payment off the total contract and then take 50% of the balance or is it based on 50% of the full loan amount (Which they told me over the phone) it seems a bit of a con considering they have had 50% of the total amount and then the value of the returned vehicle! - any comments appreciated:rolleyes: or am I beeing unreasonable ?

jayremoh

hmm, i thought it was 50% of the financed amount and isnt the GFV meant to be UNFINANCED?

speedbird1973

You pay interest on the WHOLE amount. So you need to pay half of the loan + interest.

As an example I paid £17k for a car. Paid £1000 deposit. So I financed £16k. After interest was added I owed £22k over the finance period. So when I'd paid £11k I could hand the car back.

You can hand it back now, but you'll need to make up the shortfall.

I'm not sure if the loan figure you've quoted includes interest etc, so I can't apply it to your situation, but I'm sure you can.

mellie9525

Hey... under a regulated finance agreement, you will have your halves (your termination rights) once you have paid more than half the total amount payable including the GFV and all interest, you can terminate your agreement providing the vehicle is within fair wear and tear condition... the only way you will be able to get out of this agreement is to get a settlement figure from your finance provider and sell the car for that amount... sorry