Bankruptcy and Car Finance

John80uk

Hi guys,

Hoping someone can help with a question - Are there any guidelines around when you are able to keep a car on finance, while going bankrupt?

I took out finance 6 months ago, for 5 years - £150 per month

I use the car to commute to my place of work, so not sure where I would stand.

I appreciate that they likely look at each case individually, but i'm really concerned that I won't be able to keep my car.

Unfortunately, bankruptcy is the only real option I have due to a relationship breakdown, as neither of us can afford to stay in our current property.

Thanks in advance for any help!

adpod

John80uk wrote: »

Hi guys,

Hoping someone can help with a question - Are there any guidelines around when you are able to keep a car on finance, while going bankrupt?

I took out finance 6 months ago, for 5 years - £150 per month

I use the car to commute to my place of work, so not sure where I would stand.

I appreciate that they likely look at each case individually, but i'm really concerned that I won't be able to keep my car.

Unfortunately, bankruptcy is the only real option I have due to a relationship breakdown, as neither of us can afford to stay in our current property.

Thanks in advance for any help!

I think it will come down to the reasoning for needing a car and value of the car, if its over £1000 then I think they will seize the car and add any outstanding debt to your final amount.

Flyright

Is the finance HP or a bank loan..?

John80uk

Hi,

It's Finance HP through Ford

National_Debtline

Hello there,

Fords finance arm will be notified of the bankruptcy order, there may be a clause with the terms and conditions which would cause you to have to return the car to them. The value of the car would be taken in to consideration within the bankruptcy, it would be down to the Trustee/Official Receiver to decide whether or not you can keep it. There isn't a definitive answer, sadly - although your circumstances and need for the vehicle should be considered.

The technical manual covers vehicles in great detail, here is a link for you:

http://www.insolvencydirect.bis.gov.uk/freedomofinformation/technical/TechnicalManual/Ch25-36/Chapter31/part2/31-2.htm

For a more user-friendly guide, here's a useful leaflet via the Insolvency Service: http://www.bis.gov.uk/assets/bispartners/insolvency/docs/publication-word/12-589-what-will-happen-to-my-motor-vehicle.doc

Best wishes,

David @ NDL