Car finance...please help!

shar5857

Hi

Please can someone help me??

I have a car on finance with Black Horse and as far as I have been concerned it was a HP agreement. I contacted them in order to arrange VT as I am struggling to afford the car and need to purchase a more economical one.

After getting no response to my letter we called them and they said they hadn't replied because the finance is apparently not on HP but is a personal car loan so a VT is not possible.

I have absolutely no recollection of being told it was a loan and was always given the impression it was HP. I am now in a bit of a panic!
BH have said I can either try and sell the car privately and pay the balance off or voluntary surrender the car so they can auction it and again I would have to pay the balance.
My concerns with this is that the car is worth approx £2000-£2500 and the outstanding balance is just short of £5000 and I have nowhere near the amount to pay this!

Like I said I do not recall being told it was a loan as opposed to HP, had I have been told I wouldn't have purchased the car as I was aware of VTs at the time.

Please can someone advise me if there is anything I can do to get out of this situation? Like I said I could really do with sorting this out asap!

Thank you in advance, I'd be grateful for any advice that could help me.
Shelley

Apples2

If it's a personal loan you just sell it, the car has nothing to do with the finance.

Buying a new car is never going to save you money though.

What does it say at the top of the agreement you signed?

Tixy

Presumably your loan agreement does show its a personal loan?

If you need to sell it then you will get a better price selling it yourself.

Did you mean more economical in terms of running costs and insurance? or that you are struggling with the loan repayments?

If you do sell it you could use a small amount for a cheap runaround and the remainder as a lump sum against the loan.
Have you asked them if a lump sum payment will reduce the term or the monthly payment? If they'd allow you to reduce the monthly payment then that might make it more afforable as you are

shar5857

The situation is complicated slightly by the agreement being in my now ex-stepfather's name. Because of this I have never had a copy of the agreement, stupid I know! The only paperwork is the initial paperwork from when the car collected was from the garage. There is nothing on this to state HP or loan. BH did tell us that they have a financial interest in the car so its registered on HPI.

shar5857

My plan was to get a car on a new HP, one which will be cheaper to tax, insure and better mpg and also with lower monthly payments.

Tixy

I am surpised they spoke to you at all, or told you anything about the loan as its not in your name.

Is stepdad in a position to let you pay him off over a longer term at a reduced monthly payment and he continue to pay the loan at the full rate (i.e. effectively giving you a short loan but keeping on top of the payments so his credit file isn't affected).

If not maybe you can sell the car and take out a loan for the balance in your own name at a monthly repayment you can afford. That still takes you back to needing to get a cheap runaround but that may be the best option in the short term until you have paid off the £2.5-£3k negative equity.