Can you sell a car with finance against it?

Bells&Whistles

Morning people !

I've been pondering whether or not I can sell my car, it still has finance on with about 4.5 years left to pay, I don't want this round my neck for the next nigh on 5 years, what I'm wondering is if I can sell the car back to the vauxhall garage, would they write off the money still owed on it or would I end up still paying for a car I no longer have?

The finance was for £3500 (with interest nearer 6K) taken out over 5 years in July 06

What are my options?

Thanks in advance !

Acc72

It is difficult to say without knowing the type of agreement you have entered into - you need to speak to the dealer (if this is how you arranged your finance).

If you purchased the car on Hire Purchase, then you do not legally own the vehicle until the last payment has been made.

As you have not made the last payment, you do not actually own the car and therefore cannot sell it.

eg. if you got a bank loan to pay for the car then you could sell the car whenever you wanted and repaid the loan (depending on penalties etc.).

scotsgirl_3

This depends on the type of agreement you have. Either phone the company or dig out your paperwork to see what you have.

If the car is on hire purchase, then you can give it back to the finance company once you have paid at least half, and you would only normally be left with any arrears or fees you might have accrued. You will have trouble selling it as it will be registered as having finance on it and the company is unlikely to agree to remove this without the agreement being settled in full.

If you have a loan for the vehicle then the rules are different - normally if you ask they will remove the interest allowing you to sell it, but if you don't make enough to settle you'll still owe the difference

Bells&Whistles

Thanks for your help guys, the finace was done via the Vauxhall garage I think Black Horse finance but will check out my paperwork when I get in tonight, so basically I don't even own the car yet and therefore its not mine to sell, thats fair enough, but what about the dealership taking it off my hands? would that be possible?

Thanks once again !

Bells&Whistles

Thanks for your help guys, the finace was done via the Vauxhall garage I think Black Horse finance but will check out my paperwork when I get in tonight, so basically I don't even own the car yet and therefore its not mine to sell, thats fair enough, but what about the dealership taking it off my hands? would that be possible?

Thanks once again !

Sorry for the duplicate post !!!

Queen_B_3

I had my last car on Finance and when I came to sell it, I got a figure of the amount of finance that I owed. Unfortunalty for me it was more than what the car was worth so I did make a bit of a loss on it, so I carried it over onto my next lot of finance for the car I have now. It's not ideal but I had to get rid of the other car because it was going wrong so many times and it was costing me a fortune in the garage all of the time.

Bells&Whistles

Thanks for that QueenB, I guess as I've only been paying for it since July the settlement figure will be way over what the car is worth, maybe I should stick it out a little longer... thanks once again !

clint1974

No you cannot sell it as the finance company (Black Horse) owns it. If you pay half you can do a voluntary termination and hand the car back.

Bells&Whistles

Thanks for that Clint1974, that makes sense, I will have a look through my paperwork and give Black Horse a call to see what that figure would be.

themaccas

I sold a car privately that I had bought on finance a few years ago, very successfully. I priced it very competatively and had loads of interest (I advertised it in the local paper). I was very honest with all the buyers when they phoned and the person that bought it eventually, settled my finance directly and paid me the balance (around £300 I think). Since then though we have never taken on car finance as there are too many tie ins and it is a costly business. Our last cars have been bought getting a bank loan so we have in effect been shopping for a car with 'cash' albeit belonging to the bank!

scotsgirl_3

the advice i gave is definitely correct for Blackhorse. They have several different types of agreements. Unless you have a large balloon payment at the end - which seems unlikely or thissie of account- then it will be either hire purchase or personal loan.

First thing to do is find out what one, then phone up and ask for a settlement figure on the account. if you end the account early then the interest ill be reduced - basically you will only pay interest for the length of time you had the finance, so if you ended the agreement now then youo would get quite a rebate! You then need to find out what you can get for the car, hypothetically.

You then need to look at the difference and see where you stand. if your settlement is, say, 4k and the dealer offers you 3k for the car, could you afford to get a small loan, or otherwise get hol of, 1k? if you can, then this could be your best option as ou would probably pay far less interest that way. The dealer should be willing to take the car as long as they pay the money direct to the finance company and they confirm that once funds clear, the car will be removed fom the hire puchase regiister.

If you have a personal loan, then the same goes for the settlement, but the company has to remove the hire purchase interest if you ask. The benefit of this is that you can sell the car privately, where you will probably get more money for it.

The thing with this is that if you want to avoid paying a stupid amount of interest for a car you don't have then you have to find a way to actually settle the agreement. if you can't, then the interest won't be reduced, so all that would happen is that the balance would be reduce by the amount of money you get for the car - as you've said that the interest was really high then you would still be left owing a lot!