return of goods to finance company

mikeouk

I have a van which is 2years into a 4year hp agreement. Because of the mileage I do (40000 per year) I know Im at a point of negative equity, probably to the tune of about £2000. My intention was to keep it for the full term, but Ive been offered a realy good contract hire deal on a new van. My intial though was that I wasnt in a position to take on a new van because it would mean having to make up the short fall between what I can sell my van for and the settlement figure, but someone has told me if ive paid half the total Im entitled to hand the van back to the finance company,,,is this true?? obviously I wouldnt want to do this if it affects my credit rating. Ive got no qualms about the fact the finance company will have a van on their hands which isnt worth the settlement figure, so ,can someone tell me if this information is correct?
thanks
mike

asandwhen

Yes it should be correct check your agreement and call the finance company - it shouldnt affect your credit rating either - I did this a couple of years ago.

mikeouk

it just seems abit too good to be true,,there must be a catch!!!! or am I being cynical
I have a van worth about 4 grand that I owe 6 grand on, and I can just off load it to the finance company no questions asked???

asandwhen

mikeouk wrote:

it just seems abit too good to be true,,there must be a catch!!!! or am I being cynical
I have a van worth about 4 grand that I owe 6 grand on, and I can just off load it to the finance company no questions asked???

yep thats correct - if it is a hp scheme then it is one of the terms and conditions - call them up and ask them.

mikeouk

just rang them,apparantly you can only do this if its a regulated agreement, mine is a non regulated so I cant do it

immoral_angeluk

We have a HP agreement with Welcome car finance and although you can hand the car back, you have to pay a rather large settlement fee to get rid of it. Check your terms and conditions..

bingo_bango

Mike.....Couple of questions.
Did you buy this as a private individual, or as a trader, and if a trader, is this a limited company?
What exactly does it say on the front of your copy of the agreement? (Should be something along the lines of 'This is a consumer credit agreement/hire purchase agreement.....)
Was it over £25K finance, or was the total cost of the van over £30K

Although you've been told it's unregulated, that may not actually be the case.

Phoenix79_2

If its a regulated agreement then there should a box on the agreement stating how much you would need to pay in order to voluntary surrender (it will be 50%).

If its over 25k that has been financed or you are a ltd company then it will be unregulated.

mikeouk

im a limited company, hence its unregulated

Phoenix79_2

You will need to settle then. You are probably best trying to market the van privately as all the finance company will do is bung it through an auction and chase you for the shortfall.