Need advice as CAB cant give it to me on the phone apparently!

rescuethemall

I've got to go down in person for them to send a letter to Halifax asking for them to freeze the interest, fair enough i'm on holiday next week so can go down early one day, but the woman on the advice line couldnt help me with my query as 'i'm only an assessor' :mad:

My query is about car finance. My last normal payment of car finance is 1st November 2006, then on 1st December they would expect their 'bubble' payment of £3,700 - which of course I dont have!

My OH and I are trying to think of the best way forward, but thinking worst case scenario (i.e. going bankrupt), so know that my dad couldnt pay the last payment, and be the legal owner of it, as the OR would see that as me trying to sell my assets, and simply take the car - so my dad would lose out and so would I.

Could anyone tell me if I were to trade my car in (with my OH's also), so that the 1.5k difference (bubble payment taken from what it's worth) is put towards a car for my OH, which the finance would be in his name.

Would an OR see that I've put the 1.5k towards another car - just I know that I cannot give my car back to VW and get the 1.5k from them, I'd simply lose it.

We want to go down to one car if we can, and thought if we can put as much deposit in we have less finance, but are just a bit concerned how deep the OR would look into what happened to my car finance and the car etc.

wuckfit

if you've paid more than 50% of the finance on the car, I'm led to believe that you can write to them, terminate the contract (at any time) and simply hand the car back. obviously if the car is worth far more than the outstanding finance that's not the sensible option.

if you want to go down to one car anyway, then it may be the best option.
if you were trading it in, you'd get the trade-in less the outstanding finance. so if the car was worth 3800 as a trade in and the finance was 3700 you'd be left with only 100 towards your new car.

rescuethemall

wuckfit wrote:

if you want to go down to one car anyway, then it may be the best option.
if you were trading it in, you'd get the trade-in less the outstanding finance. so if the car was worth 3800 as a trade in and the finance was 3700 you'd be left with only 100 towards your new car.

Thanks for that, our concern is whether or not the OR would look into it, and take the OH's car away as a deposit from my car was used?

wuckfit

as far as the bankruptcy laws go, I think that you're only allowed a car up to the value of £1000 or so. if you have a big fancy car then the OR would probably force the sale of that and give you £1000 back to buy a 'banger' anyway.

I'm not an expert, I'm sure there will be others who can clarify...

newmoneysaver_2

If i remember correctly, when I took out finance with Renault there were three options whrn it came to the big bubble payment - Pay off, trade in car and use difference as a deposit, or they will buy back the car for at least as much as the bubble payment...possibly more... Is this an option to you?

Just an edit to say, finance was paid off before it got to bubble payment so never actually got to that point, so memory is a bit vauge!

rescuethemall

newmoneysaver wrote:

If i remember correctly, when I took out finance with Renault there were three options whrn it came to the big bubble payment - Pay off, trade in car and use difference as a deposit, or they will buy back the car for at least as much as the bubble payment...possibly more... Is this an option to you?

Just an edit to say, finance was paid off before it got to bubble payment so never actually got to that point, so memory is a bit vauge!

Hi,

Unfortunately VW dont give you anything in return if you simply return the car to them - which is a pity!

Somerset

Hi rescue

It's clear from your post that you are aware the OR will look at your finances/assets. If I read this right, you anticipate the trade in for the current car less outstanding finance to leave a 1.5k surplus. You will then use that surplus as a deposit for a new car with the additional finance and ownership being in your O/H's name.

You'll have effectively given your O/H 1.5k. That's how the OR will see it. Whether the OR will do anything about it ie seek to recover it, I don't think anyone including CAB can tell you for sure. It's obviously a possibility.

What if you were to just use the 1.5k to buy a replacement car i.e. no upgrade ? Even though it will be in your name, I understand the OR allows people to keep low value vehicles e.g. 1 - 2k should be ok. If you go your original route and the OR picks it up and insists on a sale/buy-out to recover that 1.5k you'll be totally scuppered.

rescuethemall

Somerset wrote:

Hi rescue

It's clear from your post that you are aware the OR will look at your finances/assets. If I read this right, you anticipate the trade in for the current car less outstanding finance to leave a 1.5k surplus. You will then use that surplus as a deposit for a new car with the additional finance and ownership being in your O/H's name.

You'll have effectively given your O/H 1.5k. That's how the OR will see it. Whether the OR will do anything about it ie seek to recover it, I don't think anyone including CAB can tell you for sure. It's obviously a possibility.

What if you were to just use the 1.5k to buy a replacement car i.e. no upgrade ? Even though it will be in your name, I understand the OR allows people to keep low value vehicles e.g. 1 - 2k should be ok. If you go your original route and the OR picks it up and insists on a sale/buy-out to recover that 1.5k you'll be totally scuppered.

Hi thanks for this and I think you totally understand.

I can see your idea about using the 1.5k to buy a car by trading my car in, though to be honest the places I'd have to go to get a 1.5k, I'm not sure they'd pay over what the bubble is - but I dont know that for sure.

We hadnt thought about that route as we were unsure on how much a car could be worth in my name without it being taken away.

The other option we were looking at was that my dad said he would buy a car for me, which I would have the use of but not own, but not sure how the legality of this would work with regards to if I were the registered owner, if the OR would see this as 'my' car even though I didnt buy it etc, and insurance issues.

It's a difficult thing to try work out what the best thing to do is.

rescuethemall

Somerset wrote:

Hi rescueWhat if you were to just use the 1.5k to buy a replacement car i.e. no upgrade ? Even though it will be in your name, I understand the OR allows people to keep low value vehicles e.g. 1 - 2k should be ok. If you go your original route and the OR picks it up and insists on a sale/buy-out to recover that 1.5k you'll be totally scuppered.

I forgot to ask - if we did go down the original route, and the OR finds out - and asks for the sale/buy-out to recoeve the 1.5k - does that mean that if my OH paid the OR the £1.5k then it would be settled and my OH would still keep his car?

I dont really want to it to get to bankruptcy but I want to try think ahead so we dont trip up in the future.

Somerset

rescuethemall wrote:

The other option we were looking at was that my dad said he would buy a car for me, which I would have the use of but not own, but not sure how the legality of this would work with regards to if I were the registered owner, if the OR would see this as 'my' car even though I didnt buy it etc, and insurance issues.
It's a difficult thing to try work out what the best thing to do is.

If your dad buys a car and allows you to use it, that's his business. Make sure he is the registered owner at the DVLA and keeps proof of purchase/recept/paperwork proving he paid for it. I believe you can be shown as the 'registered keeper' at the DVLA so dad is the owner but you are the user. This would be fine with the OR and it's completely honest and above board. If you need the car for work/getting about, I believe the OR allows a sum for normal car running costs. I'm sure the insurance could be sorted out, the registered owner/user scenario isn't unique.

The OR looks at your assets - if the car was bought by your dad, is registered to your dad, then it's not your asset and is ignored.

Floss

Insurance companies usually ask "are you the registered owner" but as I always have been, I don't know how they see another person being the owner....maybe ring your insurers & ask? Think it's to deal with parents buying little Jimmy a car for his 18th & him insuring it in his name to get the no-claims, but really it's Mummy's car....which would be almost your situation!