Help! do i have a personal loan or HP

charliem_3

Hi

we bought a car 2 1/2 years ago and unfortunatley we can't afford to pay for it.

The question is this: on the loan documentation it says personal loan with Black Horse. but when we went to trade the car in for something cheaper they did a HPI check and up popped this loan.

Advise Please because we have paid over 1/2 the loan we can return the car.

Thank You

jenni1188

I am not sure but i have looked at getting a car through black horse and here is what i thought it was.

HP is when you pay monthly repayments and then at the end of the contract pay a baloon payment or trade your car in to get another! With this the car has been bought the finance company and it is like your leasing it but at the end you have the option to buy and own it outright. The car throughout the payments is never actually yours!

Black horse as far as i am aware are a finance company for cars, it is a loan you have but it isn't a bank loan it was soley to purchase a car if you can understand so you own the car outright but need to pay for it obviously!

As far as HP it checks any outstanding finance on the car, with you your loan will pop up i would have thought as the car was bought from a dealer who is approved by blackhorse and has specified a car loan! You cant get a loan direct from blackhorse unless it is vehicle unlike you can from a high street bank.

If you had an high street bank loan it wouild not have shown up as you have got the money and purchased something but the bank doesn't really know what so there is no ties if you get me with a car.

The blackhorse has a tie with the car so i am guessing this is why it is showing as you have outstanding finance on the car.

I hope you can understand me but this is only what i have understood this to be, i have had no experiance in this or have spoken to anybody who knows so any comments on if i am right forum would help me and Charliem.

I am sorry but i have no advice on how you can get out of this apart from ask for the amount you owe on the finance with regards to paying it off, get the figure and get a bank loan to pay it off and then sell the car or trade it in at a dealer for something of less value and pay a chunck of the loan with whats left of the money and as the may be less running cost, you may find you can start to pay off the bank loan quicker.

Other option is to get in touch with black horse, explain you difficulty and try to get smaller payments but i don't know what effect this would have on your credit score!

I hope this helps and like i said any back up would be appreciated as is my perception right!

Jen

scotsgirl_3

I work for blackhorse so can probably clear this up. It sounds like you have a loan agreement - these are still arranged through the dealers. Blackhorse still puts the cars on the HPI register for a variety of reasons, but because it;s a loan if you contact them requesting it then they will remove this interest enabling you to sell the car if you wish.

Because it is a loan you will not have traditional VT rights - if you returned the car it would be sold at auction and you would be responsible for the balance after sale

if you need any more info just ask

charliem_3

Hi Scotsgirl,

Thanks for clearing that up for me but now my situation is worse!!!

we can not afford the monthly payments or even run the car! (high car tax and fuel)

Please can you tell me what to do?
our loan amount was £25709.80 and we have paid £13739.56 and have not defaulted yet!

Your advise will be SOOOOOOOOOOOOOOOOOO much apprciated

Thank you

scotsgirl_3

basically your options here depend on how much the car is worth. Because it is not on hire purchase you are entitled to sell it. Have you asked for settlement? thish will give you an idea of what you would need to ge in order to clear the loan completely.

By the sounds of it getting rid of the car is probably your best option. There are a lot of variables, but its likely you would get more for it selling it yourself than BH would at auction.

If you were to sell it yourself but not be able to clear the account, then if you put the money onto the account it would go into a "prepaid" state. You would be left owing the difference between the balance ( not the settlement, the balance is normally higher) and whatever you pay off.

The possibility is that you may end up still owing money for a car you no longer have - I don't want to sound negative by telling you this in any way, just want to let you know where you stand. I don't know the in's and outs of your finances, or the cars value etc so it is hard to be specific. However, even if you were in a position where you had a balance leftover, this would obviously be far less than you owe now, and because your account would be running ahead ( assuming you pit sales proceeds onto it) then you would work out an amount that you could afford to pay monthly to clear the balance. if you did this right you could do it without ever " defaulting" if this is a concern to you.

sorry if this sounds a bit confusing. 1st step is to call blackhorse in the morning and ask them for

1: settlement figure
2: balance
3: removal of car from HPI register

this should give you a better idea of where you stand. if you want to come back to me when you have figure then can try to work things out for you a bit better!

charliem_3

Hello again Scots girl

we phoned black horse and they are sending a settlement figure in the post but will not remove the car from the HPI register until we sell it.
so now we are completly stuffed!!!!!!!!

don't know what to do now.........

scotsgirl_3

try phoning again and if that doesn't work send in a letter requesting it's removal. I suspect you have spoken to someone who does not know the situation with this - unfortunately a lot of people don't ( including staff lol) but if it's not on HP they have to remove it. you may need to get stroppy about it to get it done though - it is not common knowledge, even amongst staff.