Debt in someone elses name - Car finance

stefan127

All the finance is in her name,from the original car and the new one. When the car was part exchanged it was meant to be a simple "swap".

It's a mess. She can't afford it and she's going to be in debt because of him now and probably have bailiffs round in the coming months.

The finance which was passed over to Aktiv Kapital wasn't because of a default; I believe Car Craft sold their finance on to them before going bust. If anything my brother has not missed a single payment for any of this.

He hasn't lost his job yet but he probably finds out this week. The waiting is killing me and it's not my debt.

In the worse case scenario would bankruptcy be an option? The cost of defaulting is bad enough anyway and that'll screw her over for years if it happens. She lives at home with my mum so has no assets in her name other than the car... it sounds extreme but the £9,000 and the £4,000 of dead money are a lot for her.

I'm just hoping he keeps his job and he can just pay out more than he needs to for the next 4 years and learn a lesson from this!

Tixy

If he loses his job and cannot keep up with repayments, and if she cannot then keep up with repayments herself then they'd need to hand back the car and then see what the shortfall debt owed is.

At that point she could then make a decision as to whether she/he can come to an agreement to make reduced payments or whether to consider bankruptcy or other forms of insolvency.

If it gets to that stage then suggest that she speaks to one of the debt advice charities, such as national debtline / stepchange / CAB fo advice on her position and what option might suit her circumstances.

stefan127

Thanks, I think if the worse happens I'll be taking them straight to see a debt charity.

I'm being extreme with bankruptcy, I know, but it's a bit of mess. The family have never been in any financial struggles like this potential one before so we're not taking it s well as others might. It always comes back to me since my dad passed away (he was useless with money to be fair).

Luckily my sister has no plans on getting a mortgage or any major finance in the near future (she's 23) but debt can cause all kinds of other issues. In my last job, for example, they wouldn't employ anyone with a CCJ or bankruptcy in the past 2 years.

I'm already paying close to £200 a month for the £8000 debt I bailed him out with but he is paying me back... for now. That will already affect me if I ever needed finance for something else because it'll show as I have £200 more outgoings each month, and I don't think they'll take into account him paying me as "earnings".

Again, anyone reading this, don't get finance for someone else! There's stories like this all over the internet and it's a massive stress when things go wrong like this.

stefan127

Still no update from my brother. He is useless. He hasn't even acknowledged when I asked for the documents.

Now, the old car was part exchanged whilst it was still on finance. Is this allowed?

Car Craft went bust of course and he received a letter last week to advise of who the administrators are.

He is still in limbo about his job but won't get much redundancy if he is laid off.

So... Do you think we'll have a case if car craft exchanged the car knowing there was outstanding finance on it? This is part of the reason he pays so much as he is still paying off the finance on the old car as well as the new one.

Ta.

Marktheshark

CCA the documents from the lenders.

stefan127

He is coming home this week as he lost his job

It's all a bit of a mess so I think we're best off going to the CAB and looking at realistic options.

I have looked into a Debt Relief Order for her but as the car is worth more than £1,000 I don't know if it will be accepted, unless perhaps the finance company take it back?

I am pretty certain it's on finance and not a hire purchase.

Nearly £500 a month finance for a £9,000 car over 4 years, who does this?

My brother is to blame and my sister was stupid by agreeing to it but the company are vultures letting this go through and now they've gone bust so there's even less we can do.

pineconesjay

What a bloody mess.

The dealer took advantage of your brother (and sister) - so much for being a 'friend' - and your brother took advantage of your sister (presumably he approached her with the brilliant idea in the first place).

I feel for your sister, who is learning the hard way that you DO NOT go guarantor or take out loans for other people, family included. If the banks thought he was a good candidate for a loan, they would have given him one. Lesson learned for little sister?

Mr_Mink

Just to clear up a couple of points for you. Hire Purchase = finance and judging by the monthly payment, the finance probably is Hire Purchase since the other common finance type (PCP) usually has lower payments but with a balloon payment at the end of it all.

The dealership could have taken the car in as a part exchange with finance still on it, but would be expected to clear it before selling it. It would also be in their best interest to clear the loan against that part exchange vehicle because a: most people would avoid a car with outstanding finance against it and b: if the original financee (i.e. your sister) failed to pay, the original creditor could reposes that vehicle from the dealership.

Have you gotten a credit report for your sister to see just who is claiming to have an account with her? (Noddle is free but you can usually get a free trial of the bigger players like Experian if the accounts don't show up there). This could help untangle the web of creditors to some extent if your having trouble extracting info from your brother.

stefan127

Cheers.

Luckily he has walked into another job for £16 an hour (and up to 48 hours a week) so he should be fine for now.

Also, my sister has a letter from the administrators regarding the finance and a portion of it may be written off. I am not at their house now so can't get the ins-and-outs but it's basically something to do with the Drive Happy portion, and they have the option to keep it going on cancel it and that part of the finance will be written off.

There's lots of companies involved now and it's getting messy, each of the 3 finances are seemingly with different companies and to add to the mess another company are now administrating Car Craft it seems!

I'll get her to do that Noodle Report anyway because it'll be handy for me to see it.

But, all should be well if he keeps this job!

Thanks for your help everyone and sorry for the vagueness (I am working on a Chinese-whispers basis here!). I hope I don't have to come back to this thread!

It's definitely a lesson learned from all parties! My sister refuses to get anything for him now and so do I. I have a loan of £8k in my name for him which, with his repayments to me, I am putting away for a mortgage in the future so that kind of works in my favour as I can afford it and if he misses one I'll be on his case.