car worth less than what is due on finance

jakeleo09

Hi guys, I have a car which I bought nearly 2 years ago but i traded in my previous car too early. My car in now worth roughly £5000 but I still owe £6000 on the finance. I am due another baby in September and would like to get another car to suit. I'm able to afford a car at about £13,000 if I can balance out the remaining equity. Anybody know if it's possible to trade the car in without throwing away a huge deposit? How do I go around this? I wanted to hand the car back saying I didn't need it anymore. The car drives me nuts as the previous owner did some diy on the electricals but i found out too late. so i cannot hand the car back. I took it out over 5 years. any help is appreciated to get rid of this car. thanks

forgotmyname

Is it HP or a personal loan? My sister thought hers was HP but turned out it wasnt. Not sure how it would affect your credit report.

A garage would take your as part ex & pay off the current loan, Problem there is if your buying a £13,000 car you would be adding £1000 to the new loan. And have a car worth a lot less than the new figures.

Possibly they might offer a higher interest rate?

sheslookinhot

So, your are taking a loss on the car you have, £1000 minimum. Then you can afford another car about £13,000. Whats the problem ?


Do you need a car about £13,000 or can you buy what you want for less ?

You will always lose on new cars. The more you spend the more your losses are likely to be.

jakeleo09

yes i will always be making a loss, this is true. of around £1000. I already went to a dealer and they call it upside down loan and I just don't know if anybody is willing to do it as the finance companies won't pay out for something that is worth less than what i apply for. I don't actually know if its HP or not but will find out later today.
thanks

LandyAndy

jakeleo09 wrote: »

Hi guys, I have a car which I bought nearly 2 years ago but i traded in my previous car too early. My car in now worth roughly £5000 but I still owe £6000 on the finance. I am due another baby in September and would like to get another car to suit. I'm able to afford a car at about £13,000 if I can balance out the remaining equity. Anybody know if it's possible to trade the car in without throwing away a huge deposit? How do I go around this? I wanted to hand the car back saying I didn't need it anymore. The car drives me nuts as the previous owner did some diy on the electricals but i found out too late. so i cannot hand the car back. I took it out over 5 years. any help is appreciated to get rid of this car. thanks

Buying a secondhand car on five year finance is a mug's game.

Pew_Pew_Pew_Lasers!

Why don't you sell the car, pay off the finance, and buy something a lot less expensive that you can actually afford outright?

no_more_cards_for_me

Pew_Pew_Pew_Lasers! wrote: »

Why don't you sell the car, pay off the finance, and buy something a lot less expensive that you can actually afford outright?

Best advice so far :beer:

SemperFi

Pew_Pew_Pew_Lasers! wrote: »

Why don't you sell the car, pay off the finance, and buy something a lot less expensive that you can actually afford outright?

Not that straightforward with finance. You don't own the car to sell it. Has to be finance cleared really before you sell it. Not easy unless A) you find a willing party to pay off outstanding finance or You have the 5k in your bank to pay it off yourself.

AFAIK

jakeleo09

exactly, its not mine to sell and i don't have £5000 to throw away. basically that would just disappear wouldn't it? so i guess im stuck with my car then?

LandyAndy

jakeleo09 wrote: »

exactly, its not mine to sell and i don't have £5000 to throw away. basically that would just disappear wouldn't it? so i guess im stuck with my car then?

If you really want rid of the car get a personal loan from your bank. Use £6k to settle the HP on your current car and the rest (plus the full trade in value of the car that is now yours) to buy a new one.

jaydeeuk1

Why not get a credit card like egg money, which has 0% interest for 12 months currently, BT £6k or so from your debit account (useful card ) and pay off that way? Then just BT to another credit card in 12 months?