Voluntarily terminating a hp agreement

Daniyella

Id like opinions on this, we have reached the half stage and in the terms and conditions we can hand the car back by voluntarily termination, we are looking to change our car and have £1600 negative equity which could possibly be got rid of as i dont really want to take negative equity into the deal.

My questions will this affect our ability to borrow when it comes to getting our mortgage in may?

Has anyone done this and how did it affect your credit rating?

Is this a big No no?

The guy at the finance company said it didn't but my mum seems to think it will?

Rain_Shadow

You need to have repaid 50% of the total amount payable so if your agreement has a final balloon payment you need to consider this too.

I have VTd a car and immediately financed two more. Caused no trouble at all.

I imagine your mortgage lender will take into account that you have a loan but I don't see why a VT should affect their opinion, after all it is something laid down as acceptable in law, not a default.

ETA. I see that there is a balloon. https://forums.moneysavingexpert.com/discussion/4732087

Ultrasonic

Re. the mortgage part of the question you'd probably be best asking the question in the mortgages section of this forum.

Olza23

The credit agreement that you signed will state you are well within your rights to hand the car back after you have reached the 50% mark, they allow for general wear and tear but not much more.

Who is the car financed by?

Daniyella

Suzuki Finance (Black Horse)