Unregulated HP Car Finance Agreement - Termination advice required please!

rensters

Hello,

I've posted on here before about this agreement, but I'm hoping one of you lovely finance-savvy people can offer me some advice as I am in a predicament!

We have been struggling for a while to meet payments on an unregulated (total amount borrowed was over £25,000) HP agreement we took out in March 07. The monthly payments are £580 and we've only managed to pay £290 each month for 4 months now (we agreed this with the finance company when my husband lost his job). They've now served a default notice and advised we have to pay £600 within the next 10 days and £655 each month for the next 8 months and then go back to paying £580 per month after that, otherwise they will terminate the agreement, reposess the car, sell it at auction and make us pay the difference plus costs.

We have no requirement for the car any longer so we are more than happy to hand it back, but we have no way of paying what's left on the agreement (which we estimate to be in the regoin of 8 or 9 grand). I am also concerned that they may sell it at auction for way less than it's value and try to stitch us up on storage costs, insurance, etc, bumping up what we already owe them.

My predicament is this - do I terminate the agreement now in writing, maybe detailing my concerns and explaining that I am willing to drop it off at their desired location to keep costs down, etc, or do I just let them do their thing and see what happens.

Does anyone have any advice on what might be best? I know under the consumer credit act (which I unfortunately don't have the pleasure of falling back on) it is best to terminate the contract yourself, rather than letting the creditor terminate, but I'm not sure what would apply in my case.

Any advice would be hugely appreciated. Thanks in anticipation.

Kerry

chalkie99

Someone will be along with better advice in a moment I am sure but, a quick question.........

If the loan was for £25k in March 2007 it seems to me that you have paid a bit less than 17k on it.

Allowing for interest how are you calculating you only owe £8k or £9k ?

rensters

Sorry, I didn't make it clear!

The finance was originally for £35,848.47 (which is over 25,000 and therefore isn't regulated by CCA 1974) There is approximately £19,700 left owing so we would owe approximately 8 or 9k once the finance company reposess and sell the vehicle for it's market value (approx £11,000) and offset that against the balance.

Thanks for your reply

~Brock~

As you know you do not have any of the protections and remedies that the CCA would provide so............

Co-operate with them - your best scenario is where costs are minimised, because these will ultimately end up being added to the account.

Hand back the car yourself. This will negate the need for them to employ a repossession agent to collect it with the associated costs. If you are able to deliver it directly to your nearest auction site then there will not be any storage costs wither.

Make sure the car is in good cosmetic condition and clean. Take photos of it as proof.

If they sell it at auction then it will acheive, by definition, its true value in the case of a non warranted sale. The good news is that used car prices are holding up surprisingly well at present because of a shortage of good used cars.

Make an arrangement for the remaining balance that you can afford and stick to it. This should minimise the amount of charges you incur in the future caused by the lender having to chase you.

rensters

Thanks Brock, that's kind of what I was thinking. Dropping it off at an auction site is a good one! Should I write to them to offer this so they can see I'm keen to 'help' or is it best to arrange over the phone?

Thanks

Kerry

iolanthe07

It's difficult to believe that a quality car would drop in value from almost £36K to £11K in two and a half years. You may receive a lot more than that - hope you do, good luck.

rensters

Thank you, I hope so too!

Many thanks to everyone for your reliable advice and kind support.

I have learned a valuable lesson over this and will always read every last snippet of small print in future - I would advise anyone out there reading this to do the same. I could have saved myself a lot of expense, stress and tears!