Walkaway clause?

Gollom

Hi!

I have a PCP on my car (over 3 years into a 4 year agreement) which is into negative equity due to the mileage. It has been suggested that I could simply walk away by handing back the car and then start over (with a more realistic mileage allowance this time!!!)

Surely there must be a downside?

Thanks

scotsgirl_3

it depends on who your finance company is and on the way your agreement is set up. look at the paperwork.

the most common option with a PCP is that it has monthly instalment and then a final "balloon" payment. if you look at the paperwork you may find you have wha is called a guaranteed future value - basiclly this is the amount that the finance company promises to give you for the car at the end of the r if you choos to hand it back, and its normally equal to the balloon payment. generally i will also have a mileage stipulation. this is theonly time when you are likely to be able to hand it back and owe nothing.

however, phone your finance company as each is little different an this is only the way i have seen them done

hope ths helps

Phoenix79_2

Can't you keep it until its balloon is due then hand it back? Thats what most deals allow although you will be clobbered for excess mileage. You should have contacted the finance company when you knew you were going to be doing more miles and they would have altered your agreement accordingly (you would be playing slightly more per month).

Have you paid back over half of the financed amount (balloon included)?

Gollom

yes, paid back well over 50% including the balloon

Thanks for your time