Scrapped a Hire Purchase vehicle.

edwinland

A year ago I was looking to get a car loan and came across a broker who managed to get me a high APR deal, which i took (wish I didn't now).

I found a vehicle, told the broker all about it and I signed some documents before being allowed to collect the car - at the time I assumed it was a loan, I was kind of rushed though signing the documents and never really thought anything of it.

A year down the road, and the car just giving me problems, and the final straw was when the engine just went 'bang' - so I had it collected by the scrap man.

Now after wanting to arrange lower payments with the finance company, they wanted to know the condition of the car, so I tell them, and I am told that the car was on Hire Purchase..

What can I do? Have I broke the law by scrapping the car?

EllieF

Hi Edwinland,

Not sure how much you know about HP's (I don't mean to be patronising, just with you saying you didn't know it was a HP)

Under a hire purchase agreement the ownership of the goods (car) does not pass to the borrower (you) until all repayments are made to the lender (creditor).

The creditor may not seize the goods without a court order (yes, I know there's no car left) after one third of the repayments have been made.

The hirer can not sell the goods at any time until payment is remade, and you as the hirer are legally responsible for the upkeep of the car and any damages incurred. For this reason I don't know if the defence of "I didn't know it was a HP" would stand up to be honest.

Under UK law the hirer must have the option to buy the product at some point (usually when the last payment is made) or return it to terminate the agreement.

HOWEVER - the creditor must provide pre contract information to the hirer first, setting out the exact terms of the proposed agreement - I'm guessing the broker did not do this and/or you did not read the document properly that you signed?

Either way, legally, the car was still the property of the creditor.

Hope some of the above helps in some way. Good luck.

edwinland

Thanks for the reply.

So what law did I break, and what will happen/is the punishment?

DVardysShadow

edwinland wrote: »

Thanks for the reply.

So what law did I break, and what will happen/is the punishment?

I would say it is a civil wrong, where there is no punishment, but you must put the loser back in the position they were in before your civil wrong. So, if they cut up rough, no reduced payments for you.

Billy_two_speakers

edwinland wrote: »

Thanks for the reply.

So what law did I break, and what will happen/is the punishment?

you broke the law regarding HP regs

they can sue you for the total cost of the agreement plus all costs
http://www.insolvencyhelpline.co.uk/legal_issues_explained/car_repossession.php