settle a car finance default

mingebag

Forgive me if this is in the wrong place.
In 1998 I bought a car on hire purchase. I was young and eager to take my shiny new car. Anyway first off my parents offered to lend me the money. I told the salesman and he said it was now to late to cancel the agreement, I hadn't picked up the car at this stage. I was told the agreement would be 4 years with a apr of 8.5%. I was going to get a loan from the bank and the guy said he would beat it.
Anyway 2 years later I was after a new car and when I rang for a settlement was shocked at the balance. It turns out my apr was 22% and I had a 5 year agreement. At this point the garage had closed down. In my anger I cancelled the payments and told them to collect the car. To cut a long story short it ended up in court with £50 deducted each month from my wages. I checked with the wages department today and I have paid about £3000 with £1500 remaining.
What I want to now know can I offer black horse, or Sechari, Clark & Mitchell a figure below this to settle now?
Also as a long shot is it possible to claim I had been mis sold the finance? I know I should of checked what I was signing but at 19 a shiny new car was more important. Thanks for your time.

GeorgeUK

Not sure about the reclaiming, but if there was Payment Protection Insurance added then it may be possible. You would need to get hold of a copy of the original agreement though to check this. I know your might get this applied to a loan, but not sure about HP.

Is it a CCJ you have?
You can make a reduced offer at any time - it will take them about 2.5 years to get their money back so they may accept a lump sum offer.

If you do make an offer, make sure it is in writing and that you get written confirmation before sending any payment. The letter should state that it is a full and final settlement (not a partial or short settlement) and that you will not be liable for the remainder of the debt. There are some template letters on the board if required.

Edit: Hang on, you told them to come and collect the car?
If it was a HP debt then this would be a voluntary termination and you should only have been liable for 50% of the total amount. What happened?

mingebag

Well they took the car sold it at auction, deducted what it sold for off the remainder of the balance and then billed me for it.

GeorgeUK

Was it a loan or HP?

If it was a loan, then you would have been liable for the full amount.

If it was HP, then you called them to take it away which would have been a voluntary termination and you would have been liable for 50% of the original amount. If you had already paid 1/3 off then they would need to go to court to get the car reposessed. If this did not happen and they just took the car, it would be a voluntary termination.

Has this already gone to court?
It might be worth giving nationaldebtline a call to see if you can get a redetermination if this is a CCJ.

mingebag

It was hire purchase. It went to court over the payments. I have £50 a month taken directly from my wages, I have been paying this since about 2004. The way the apr was I had to pay back double what I borrowed. So I probably am paying the 50% back, but I'm not sure.
I'm guessing I don't have a leg to stand on now regarding getting mis sold the agreement. So can I offer them a settlement of less than the £1500 I owe?

GeorgeUK

Yes

I would strongly advise going over to the consumeractiongroup forum though and post on their legal issues board. If the car wasn't reposessed then you should only have been liable for 50%, not the full amount. If you can crunch the numbers to see if you were paying the full amount owed, they may be able to advise if this was correct or not and what you may be able to do about it.

The agreement being missold i don't think you would be able to prove, but if there was payment protection insurance (PPI) on the agreement, this may have been missold and you may be able to claim this back.

You can make a reduced settlement offer on a CCJ. I would check if there was PPI first though as this may be enough to pay off the outstanding amount.