HP Car Loan with Balloon Payment

imazeu

Hi,

I have a quick question that I hoping someone would be able to answer!

I have a vehicle that I bought on HP 2 years (today) ago, I have a year of further payments before the balloon payment is introduced.

Now, I do not have the agreement with me, other issues have seen to this but I was wondering whether it is possible to hand this vehicle in without penalties! (Perfect credit history). I have heard stories that I have to pay off half the price of the vehicle before I can voluntary terminate the agreement, I have also heard that under these loans they do not fall under the comsumer credit act 1974.

Financially I bought the vehicle (BMW) at the figures

Paid for £26500
With Interest over term £ 33,500 (approx)
Monthly payments - £538.00
Payments made so far - 24
Balloon - £8,500

Thanks in advance

Malky

I would have thought you'd have to wait another year to hand it back. These things normally work in a way that you pay a set amount for 3 years and after that you either pay the balloon payment or hand the car back.
HP agreements I've had in the past had the option to hand the car back after 2 years or half payment. But my agreements have always been based on paying off the whole amount in 4 years with no balloon payment at the end.
I think the agreement you have and the ones I've had are two different types. I'm pretty sure you can't hand your car back at this stage unfortunately.

CLAPTON

the usual HP principle is that once half the finance has been paid then you can hand back the car ... in your case 16,750

however this usually doesn't apply to deals worth more than 25k so you need to check your contract.

Eric_Pisch

CLAPTON wrote: »

the usual HP principle is that once half the finance has been paid then you can hand back the car ... in your case 16,750

however this usually doesn't apply to deals worth more than 25k so you need to check your contract.

I am in the same boat, you need to see if your agreement is regulated or unregulated (it will be written on it)

If you have paid back half (with the balloon counted to the half left) and if its regulated you can hand it back