Personal Contract Purchase termination - help!

local_yokel

Due to a mental illness, my wife has been forced to leave her job and will shortly be unable to pay for the PCP on her BMW that she purchased for the job.
We can ill afford the montly payments now that she is no longer working and my income won't stretch to covering the mortgage, monthly housekeeping/bills/council tax/food etc.
The company were paying a car allowance that covered the car payments easily, but now she doesn't have them, what are our options with the car?
It appears that its so watertight that BMW Finance demand payment irrespective of my wifes' illness - this is just piling on even more stress - what can we do???

Nearlyold

Firstly establish how much the settlement figure is and compare that with the current value of the car if you were to sell it.


Also where the PCP is Hire Purchase based (most are) there are hand back rights once you have paid half the total payments due under the agreement, note the total payable would also include the GMFV which is due at the end of the agreement.


Without any figures or knowing how far you are into the agreement its difficult to advise further. I assume BMW have stopped selling PPI otherwise that might have provided a breathing space.


Does your wife have any ill health income protection either on her own account or through work?

mlp

You also have the option to sell the car (either privately, back to a dealer or through one of these we by any car places) and clear the remaining finance.

There is obviously a risk of negative equity here. Did you take gap insurance when you took out the finance?

You can call the finance company and ask for a settlement figure which I think is valid for a month or so.

Nearlyold

"There is obviously a risk of negative equity here. Did you take gap insurance when you took out the finance?"

There is a definite risk of negative equity but unfortunately GAP insurance will not cover it in this scenario. GAP insurance only provides cover following an insurance Total Loss i.e. theft and non recovery or accident write off.

aphill24

Webuyanycar are known to give you a better valuation for your car than the main dealer so it must be worth giving them a call

pvt

aphill24 wrote: »

Webuyanycar are known to give you a better valuation for your car than the main dealer so it must be worth giving them a call

Webuyanycar are known to give you less than their valuation when you turn up with the vehicle and they find the car has actually been used.

local_yokel

Yes, its difficult to deal with this as PCP is very new i.e. only 4 months into contract.
The car has done just 4075 miles, is in immaculate condition, but just sat on the driveway being unused now.
Settlement figure is £25,645, webuyanycar have offered £17,700, so we have a shortfall of £7945 to fork out for.
Obviosuly my wife didn't plan on getting ill and this is jsut piling on even more stress and anxiety.
Is there nothing more we can do?
I can't afford the payemnt on top of tyring to pay the mortgage and household bills as it is.
I have read elsewhere that you can just write to the finance company and Voluntarily Terminate the contract and ask them to collect the car.
Is this do-able?

DCFC79

You can only vt if you have made a certain of payments which I believe is 50%.

Nearlyold

You have to have paid 50% of the total amount payable in order to hand the car back with no further liability. If you hand the car back now the finance company will auction the car and come back to you for the shortfall so you will be no better off.

andyfromotley

sell it privately to get the max,

whichever way you slice and dice it there is going to be a shortfall.

FireWyrm

Morally questionable perhaps, but an unsecured loan for the shortfall is considerably easier to deal with than the car repayments as they stand. Sell the car, cover the shortfall, re-assess payment ability afterwards would seem to be the shortest route to freedom but your credit rating will suffer.