Selling a car on PCP finance?

wChad

Hi everyone, I'm new here.

A few months ago I purchased a Citroen C1 on PCP finance on a four year agreement. Its purpose was to be for me to commute back and forth to work. I have two kids but the plan was that they would hardly ever be in the car, so there didn't seem to be an issue with buying a tiny 3 door car.

Unfortunately circumstances have now changed and we're finding that the C1 is being used as a family car instead. Obviously it's tiny and isn't suitable for such a purpose.

My settlement figure for the car is around £4500, and having done lots of research online it seems there are two more favourable ways to sell the car:

1) Take out a loan and pay the settlement figure. Sell the car privately and then pay off the loan.

The risk here is that the private buyer may not pay as much as the loan value, leaving me to pay off the difference?

2) Sell the car privately but be upfront that the car is on finance. Apparently the buyer contacts the finance company by phone and pays the remaining balance?

Is this common when selling a car on finance, and how would I go about changing the car into their name? I wouldn't want the buyer thinking they may be paying my finance off and then I don't hand the car over to them. That's not the kind of guy I am.

I personally prefer the second option as it takes away the risk of not getting back what the loan amount was. Has anyone done this?

Appreciate any advice folks,

Thanks
Chad

forgotmyname

Is £4500 the balance to hand the car back and walk away?

Or the full settlement including the balance to pay for you to keep the car?

Having a car on finance will put a lot of people off. I would only do it it its something thats not available on every street corner and offer then below book price to compensate me for the hassle of contacting the finance and paying them.

sheramber

surely the buyer is going to pay the price he agrees with you whether it is direct to you or to the finance company. He is not going to pay more just to clear the finance.

How much do you expect to sell the car for?

If you intend to buy another car have you asked for a trade in figure for the C1.

bigjl

Surely if it is only a couple of months old it will be the new shape and likely worth more than £4500?

I saw a tatty 08 plate Aygo with no history and a horrendous paint job on all down the drivers side got for a £1000 at Auction last week.

So these small cars are in demand.

The most cost effective option would be to buy a cheap family car and out the C1 back to commuting duties.

You buy a decent family hatch for £1000/1500

You will need permissions from the car owner before you'd sell it, the finance company. As you are only renting it till you pay the final lump sum.

tberry6686

Is the £4500 the optional final payment ? If so how much are you paying monthly as it would be the £4500 (plus the monthly payment multiplied by the amount of months left minus any early settlement discount) that would make up the outstanding balnce.

£4500 to complete a PCP that you have only had for a few months seems a very low figure (unless you paid a much larger than normal deposit).

bearcat16

wChad wrote: »

I personally prefer the second option as it takes away the risk of not getting back what the loan amount was. Has anyone done this?

Appreciate any advice folks,

Thanks
Chad

I don't understand your reasoning here.

No matter what happens with finance, the buyer will pay the price they've agreed with you.

You say there's a risk you won't sell it for enough money to cover than amount of the loan, but surely the loan amount would be the same as the finance settlement? (i.e. You might have a shortfall either way!)

So anyway, it makes no difference financially either way. You'd make or lose the exact same amount either way.

BUT there are not many buyers who would agree to pay the finance off for you. Faffing about with that just complicates the deal and would probably make many people suspicious.

Some guy posted a thread about this a few weeks ago as if it were a common thing, and not surprisingly most people disagreed.

Since it makes no difference financially, just pay it off with a loan first.

Alternatively, part exchange the car, and the dealership will arrange a new agreement for you which will pay off the old one and finance the new car.

Mankysteve

Problem is your going to put a lot of people off by having out standing finance and will have to reduce its price accordingly, if you go for option B. Either way ending the agreement early is going to cost you.

=rizla=

I have to say i'd maybe be put off buy having to clear the finance off a car I was about to buy, but then again I guess i'd know it was cleared!!


With a loan have a good luck at any arrangement/cancellation/paying off early fees. Also it may affect your credit rating.


As has been suggested if you're going to buy a car from a garage see what they will offer you for yours.

Herzlos

If you've just started a PCP then you're really going to lose out on selling it. On the plus side, C1's are pretty popular so you won't have lost as much as you could have done.

Cheapest option: Persevere until it's paid off. I get that 3 doors is a pain.

Easiest option: trade it in for a bigger car; the dealer will sort the finance and you should be able to carry over any negative equity.

Most optimal option (but most work): take a loan to clear the finance, sell privately, pay off as much of loan as you can.

Did you use to have another family car? Are you better just replacing/fixing that?

nigel-swingball

Late reply I know, but i've done this on two occasions. Simply say the car has finance on it which will be paid once money handed over.

I rang Ford while the buyer was with me and paid it from his back payment to me.