Voluntary Termination of HP

thegrape

CHR15 wrote: »

They then have all the hassle of recovering the car, auctioning it off, re-calculating the shortfall, contacting you again, chasing you for the shortfall and making a new agreement for you to repay the deficit.

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Is that right? They will chase me for the shortfall?

DragonInLondon

No, they won't chase you for the shortfall. There are two ways it could shake down; one is that they refuse to VT because the vehicle is not in a reasonable condition, or they may allow the VT but then bill you for the repairs to the driveshaft, to return the vehicle to a reasonable condition. IMO it would be advisable to find a local garage to repair the driveshaft at a reasonable rate, rather than pay dealership rates for that piece of work.

CHR15 - you are incorrect about the breach of contract; a VT does not represent a breach of contract at all. The VT clause is as valid as ther term detailing the number of repayments, or the value of the repayments. Exercising the VT clause will not cause an individual to break the contract - this isn't the way contracts works. The terms relating the number of repayments, becomes 'unworkable' if an individual invokes the VT - but this does not mean that the individual has broken their contract at all.

As such, the company has absolutely no legal right (provided you have met the other terms and conditions effecting the VT) to make any entry on a credit file that could be perceived by any organisation as a negative entry. If they do then you can instruct the company to remove any marker perceived as having a negative impact.

Finally I have yet to see a credit report that has the status 'Voluntarily Terminated', as accounts can have one of a number of pre-determined status codes which are restricted to satisfactory, # missed payments, in default, Gone Away, or settled - there is no such entry as 'Voluntarily Terminated' (So far as I am aware).

~Brock~

DragonInLondon wrote: »

Finally I have yet to see a credit report that has the status 'Voluntarily Terminated', as accounts can have one of a number of pre-determined status codes which are restricted to satisfactory, # missed payments, in default, Gone Away, or settled - there is no such entry as 'Voluntarily Terminated' (So far as I am aware).

There is a flag that is set if an account is Voluntarily Terminated. For Experian this is a 'V'.

This additional flag is separate to the actual status code, and exists in the same field as the flag for Gone Away, Debt Assigned, Account Query etc.

The belief that a VT on your credit hisory can affect future credit applications is more than just a myth. Asset lenders would view a habitual VT'er as an unprofitable prospect and could potentially make their decision accordingly.

DragonInLondon

~Brock~ wrote: »

There is a flag that is set if an account is Voluntarily Terminated. For Experian this is a 'V'.

This additional flag is separate to the actual status code, and exists in the same field as the flag for Gone Away, Debt Assigned, Account Query etc.

The belief that a VT on your credit hisory can affect future credit applications is more than just a myth. Asset lenders would view a habitual VT'er as an unprofitable prospect and could potentially make their decision accordingly.

Cheers Brock - I never knew that, so you learn something everyday (in terms of the 'V' code).

VT isn't an adverse credit entry, in the same was as a default or a late payment (which are generically considered poor behaviour) but more - as you suggest - a commercial decision aide.

t508

VT isn't an adverse credit entry, in the same was as a default or a late payment (which are generically considered poor behaviour) but more - as you suggest - a commercial decision aide.

Well I would sat that vt is exactly what the finance company concerned want to think it is. Beuty is in the eye of the beholder and all that.

nelly12

DragonInLondon wrote: »

No, they won't chase you for the shortfall. There are two ways it could shake down; one is that they refuse to VT because the vehicle is not in a reasonable condition, or they may allow the VT but then bill you for the repairs to the driveshaft, to return the vehicle to a reasonable condition. IMO it would be advisable to find a local garage to repair the driveshaft at a reasonable rate, rather than pay dealership rates for that piece of work.

CHR15 - you are incorrect about the breach of contract; a VT does not represent a breach of contract at all. The VT clause is as valid as ther term detailing the number of repayments, or the value of the repayments. Exercising the VT clause will not cause an individual to break the contract - this isn't the way contracts works. The terms relating the number of repayments, becomes 'unworkable' if an individual invokes the VT - but this does not mean that the individual has broken their contract at all.

As such, the company has absolutely no legal right (provided you have met the other terms and conditions effecting the VT) to make any entry on a credit file that could be perceived by any organisation as a negative entry. If they do then you can instruct the company to remove any marker perceived as having a negative impact.

Finally I have yet to see a credit report that has the status 'Voluntarily Terminated', as accounts can have one of a number of pre-determined status codes which are restricted to satisfactory, # missed payments, in default, Gone Away, or settled - there is no such entry as 'Voluntarily Terminated' (So far as I am aware).

Underwriters do clearly see a VT code on customers file, (have seen as work in motor finance). It is used (as quite rightly stated earlier) as a decision factor.

stuartmcl

The VT process couldn't be easier. I recently did it with a car that I had through Close Motor Finance. I rang them and said I wanted to VT and they did all the ground work. I dropped the car off in Newport to an inspector, who checked the car over including the documents. I was charged £150 because the mirror was cracked, including the holder and needed replacement but this was fair enough as I had broken it. Handed the keys over, cancelled the direct debit and job done. I got a letter about 2 weeks later to say if I ever needed finance again to give them a call! :rotfl:

~Brock~

stuartmcl wrote: »

The VT process couldn't be easier. I recently did it with a car that I had through Close Motor Finance. I rang them and said I wanted to VT and they did all the ground work. I dropped the car off in Newport to an inspector, who checked the car over including the documents. I was charged £150 because the mirror was cracked, including the holder and needed replacement but this was fair enough as I had broken it. Handed the keys over, cancelled the direct debit and job done. I got a letter about 2 weeks later to say if I ever needed finance again to give them a call! :rotfl:

Well done! Your experience is likely to have been helped by the fact that you sound like you acted perfectly reasonably in terms of fulfilling your own obligations....i.e. you delivered the car yourself and you paid for the damage to the vehicle.

Unfortunately many people tend to follow the advice of the many prejudiced contributors to forums such as CAG who refuse to acknowledge the concept of the lender also having rights under the CCA 1974. This is why they end up in a mess.

At least in the MSE forum there is a healthy balance of views.

eddie1234567

Hi, I am only 7 payments away from the 50% mark for VT

If I were to make these payments now as a lump sum, can I VT as I have paid the 50% but still still some term to go till I should have paid that 50%

(think I have answered my own question, but just checking)

Common_Sense_2

eddie1234567 wrote: »

Hi, I am only 7 payments away from the 50% mark for VT

If I were to make these payments now as a lump sum, can I VT as I have paid the 50% but still still some term to go till I should have paid that 50%

(think I have answered my own question, but just checking)

yes you can