Ending Car Finance Early

sockpuppet

Does anyone have any idea about ending a car finance agreement early??
My son bought a car via Welcome Finance about a year and a half ago but recently lost his job and is now unable to make the repayments.
He is about 3 months behind and has been dealing with the collection department who have given him a bit of time to try and find another job but he's had no luck and cant really afford to keep up insurance/tax etc so the lady at Welcome said he was 'in time' to be able to hand the car back and end the agreement. But we're not sure what she means by 'in time'? Someone said that if he has paid at least half of the price he can end the agreement but do they mean half the price of the car or the cost of the car plus interest? Grateful for any advice as I am at the end of my tether worrying about debt collectors and bailiffs!

motorguy

Its if you've paid over half the total transaction cost including deposit paid etc.

So if the loan was for £10000, with a further £1000 deposit, and the total interest to be accrued was £2000, then once you've paid £6500 you can hand the car back.

I know this isnt what you want to hear, but if they do repossess it they will sell it at auction for whatever they can get and pursue your son for the difference between that and whats owed....

harveybobbles

Without stating the obvious, but could your son not get another job?

the only reason I ask is he was with Welcome for a reason, and if he gets a VT on his credit file it may make it a bit harder to get credit in the future.

sockpuppet

He is trying to get another job but he's applied for about 40 and only had 2 replies! So its not going to be quick enough to save the car. Just trying really to find the best way to save too much impact on his credit score. The lady at welcome said if he did this it wouldnt show as a default - but if they pursue the outstanding and he can't pay it as on jobseekers I suppose that won't help!
But thanks for the info

harveybobbles

You could ask WF is your son could have a break from payments for say, two months until he gets back on his feet. But offer to have the extra two months added on at the end of the agreement.

I know companies do this with loans, not sure if car finance works the same.