need advice re finance on 2 cars and now theyve changed their mind

reallyworriednow

I recently purchased a new car for myself, and also took out finance for my mother for a car for herself. The salesman told us this was fine as its not illegal to do this, so I got finance for both from 2 different companies, we both collected our cars last week and now one of the companies isnt happy I have 2 cars

Will they take the car off me? I took the finance for my mother as she has bad credit and it was only for £4,000 but mine was for £8,500.

I can afford both payments (although my mother was planning on paying hers to my account, as she can afford the repayments but bad credit stopped her getting finance)

What do you think the outcome will be?

Any advice would be great.

Thanks

Reallyworriednow

reallyworriednow

Edit to add - Car salesman just phoned, finance have now unaccepted me and they need to try and get me finance again as mother is driving a car that has not been paid for

Has anyone had this before?

chanz4

very strange, have you been dishonest in anyway?

nelly12

reallyworriednow wrote: »

Edit to add - Car salesman just phoned, finance have now unaccepted me and they need to try and get me finance again as mother is driving a car that has not been paid for

Has anyone had this before?

Yes. It's called fronting. In your case it's probably genuine however it can be used by unscrupulous people in money laundering scenarios. I am not surprised the second finance company has un-accepted you as under Anti Money Laundering regulations this is a big no no. What happens in this scenario is the finance house have a very neglible claim on the vehicle should the finance deal default. Garage definitely at fault here.

Eonel

You purchased 2 cars registered & financed in your own name? If so, why should the finance company know or care that your mother is going to drive one? She would need to have a motor insurance policy in her name.

Fronting with identity theft is obviously a serious fraud. Maybe I'm being naieve, but in this case I do not see a problem.

KingElvis

Cool, so you got a free car, well done.

I can't see what's wrong with it, it's on finance so the actual money laundering would be slow at best.

So if I decide to buy car for me and one for my good lady on finance, I'm a crook? nahhhhhhhhhh

nelly12

Eonel wrote: »

You purchased 2 cars registered & financed in your own name? If so, why should the finance company know or care that your mother is going to drive one? She would need to have a motor insurance policy in her name.

Fronting with identity theft is obviously a serious fraud. Maybe I'm being naieve, but in this case I do not see a problem.

Which is what I said. However finance houses are regulated, if they know that the car that is being financed is registered to someone else other than the hirer then they lose all of their rights under the consumer credit act of 1974. This looks a genuine case but I was just trying to indicate that there is more to it than just saying yes you can have the money.

reallyworriednow

Eonel wrote: »

You purchased 2 cars registered & financed in your own name? If so, why should the finance company know or care that your mother is going to drive one? She would need to have a motor insurance policy in her name.

Fronting with identity theft is obviously a serious fraud. Maybe I'm being naieve, but in this case I do not see a problem.

Yes she has and this was given to garage so she could collect it.

I think it was because the salesman put the car in my mothers name and not mine, thats causing the problem?

Does anyone know if this will affect my credit rating as I work so hard to keep it good and im now scared it will be terrible

standupguy

This sort of fronting is known as an accomodation deal within the industry and is really a type of fraud. You have tried to obtain credit for a person with bad credit by using your own name and not giving the lender a full knowledge of this arrangement.

The chances are the Lender may register a cifas marker against your name with credit reference agencies and this may hinder future credit applications.

The lender, now that they are aware of your mothers involvement will be wanting to unravel the deal and get their money back from the car dealer. The car dealer will want his car back from your mother.

Best thing to do is to talk to the lender, tell them you did not know you were doing anything wrong, that you were acting on the car dealers advice, that you are able to meet the payments and ask them what they intend to do? They may decide to give you a chance and re-instate the agreement.

Alternatively they may say they want the deal unraveling and you are best to go along with this.