Car Finance how to get out of

xterm

Hi guys

I have a interesting issue that may take time to explain so Ill start from the beginning;

Bought a car from ACF back in 10/2011 which is part of "The Funding Corp" £7000 car 2008 model car with a apr of 50% lets just say its a lot of money I had to repay

anyways last week the drive train snapped destroying the engine, meaning its now got to have a new engine and with other issues its now not even worth the value of the car and I've still got over £3000 to pay back

I Spoke to there collections team after emailing them that I wanted to return the car stating that i wish to return the car under Section 63 of the Consumer Credit Act 1995 (Halves and Thirds rule) and terminate the rest of the contract.

There reply was that under my agreement I cant they will get it scrapped but I will still be liable for the rest of the finance

Does anyone have any suggestions

MEM62

You purchased an asset with a value that plummets like a stone using a loan with a 50% interest rate? Wow!!

If the agreement does allow this type of termination the car has to be returned in good working order. You drive away a perfectly good car, return a wreck and expect the finance company to write off the balance. That's not going to happen. You'll need to settle the outstanding and chalk it up to experience.

One more suggestion buy your next car with cash. Even if it means it is an older or more modest vehicle. At least that way you are only dealing with depreciation - not depreciation and extortionate interest.

Brock_and_Roll

Section 63 of the Consumer Credit Act 1995 only applies to Hire Purchase contracts, not to loans of leases. The first thing you should do is to double check the wording of your agreement - if it is an HP, this should be clearly shown in the document even if it was sold to you as a "loan".


If it is not an HP however, I am afraid you are stuck with it. The finance company in effect have a separate contract with you unrelated to the car. They lent you some money, and unsurprisingly their terms don't allow you to walk away whilst still owing them. What you did with the money and whether it was fit for purpose is irrelevant.

malamadzia

I've got a new faulty car on hire purchase. Ombudsman adviced finance company to agree to return the car. They are not replying. Can I cancel direct debit?

malamadzia

Please help don't know what else I can do. Provided enough evidence that the car was faulty when we bought it. The complain been with finance company 3 months now, I've stopped using the car now and want to stop paying for it.

Nearlyold

Is this a formal final decision from FOS? i.e. You complained to the finance company, the finance company replied with their "Final Response" and you then sent your complaint to FOS who have now issued their final adjudication.

malamadzia

I've made a complaint in august.they had 8 weeks never got reply. Sent another letter giving them extra 2 weeks to get final response and got FOS on the case. Finance company asked for extra 4 weeks. Then FOS sent them the recommendation to cancel hire purchase agreement with no cost to me and for them to collect the car. They had again 2 weeks to reply. No final response yet. They came back today asking for 2 weeks extra. I have no reply from financecompany, not using the car and paying every month. Can I cancel direct debit?

Gaz83

Can you? Yes.

Should you? No.

malamadzia

Can they later say that because I've cancelled it I'm in breach of this agreement and blame me and charge me extra cost? I don't care if that will effect my credit score rating as if I won't pay for this car I won't need any credit.

Gaz83

malamadzia wrote: »

Can they later say that because I've cancelled it I'm in breach of this agreement and blame me and charge me extra cost? I don't care if that will effect my credit score rating as if I won't pay for this car I won't need any credit.

Depends on what the contract says.

If you cancel the direct debit while the agreement is live, then missed payments will be recorded on your credit file. Given that it will stay there for six years, can you honestly say you won't require any credit for the next six years?

malamadzia

Ok I understand thank you. Problem is that I've stopped using the car now also since we have the car it's always been faulty and we have strong evidences. FOS want to get only one monthly payments as a compensation so I'm loosing what I've paid already as a wear and tear cost but now they had 13 weeks and dragging the case to get more money out of my pocket. I'm just really struggling with what else I can do to get this sorted.