Balloon Payment on Car Finance

chloedance123

Hi all,

Please can someone help or give me some advice, 3 years ago I got a KA out on finance with Ford I have paid every month and its always been my priority, My three years have just ended and I now have a balloon payment of £4000.00 to pay if I want to keep the car, (All along even the day I bought the car I wanted to buy it at the end of the finance.) - Ford have declined my re-financing agreement due to bad credit and haven't even looked at my last three years of history with them - They have now given me 2 weeks to either give my car back or find £4000.00. don't have this kind of money and really don't want to loose my car if I loose my car I will not be able to carry on my employment where I work. If I give the car back I have got to give them £0.20p per mile I have gone over, So I have got to give them £6000 if I give the car back and ill be car - Less, Ford have been so unhelpful and are giving me no options at all or advice on this, I really don't want to loose my car - Does anyone know a finance company that will accept people with bad credit who can take over my finance and pay ford and then I can pay them back?! I don't even care about paying a high interest rate back either?! Also can I sell the car if I owe finance on it still?! If I can find someone to buy the car for £4000 (or close too - as I don't think its worth this much.) Can I do that and pay off the finance that way?! Any help or suggestions will be really appreciated. Thank you.

meer53

Your best bet first of all would be to approach your bank.

chloedance123

Would my bank help if I have bad credit then?

forgotmyname

If your bank wont then high interest sub prime is an option you dont want to take.

That £4000 could turn into more money than a new car costs.

Do you really want to pay £8k for your £4k car and be paying until its 8 years old?

pcman1985

The car I recently bought was a Ford KA 54 plate. It runs fine without any problems and it cost a grand total of £525 and came with almost a whole years MOT.

Just saying

Cornucopia

chloedance123 wrote: »

If I give the car back I have got to give them £0.20p per mile I have gone over, So I have got to give them £6000 if I give the car back...

Are you sure it's 20p per mile - that is extremely high. (Currently Ford are charging 7.2p, which is much more typical).

I really don't want to lose my car

That's the only thing here that you don't have control over. The car doesn't belong to you, and if you don't fulfil Ford's requirements for the PCP... well, you know.

PCPs generally have 5 options at end:-

1. Give the car back, subject to the requirements for condition and excess mileage.

2. Underwritten Part Exchange with the original manufacturer. This enables the value of the car to be under-written to the Balloon payment amount, subject to condition and excess mileage. This is only relevant if the value of the vehicle is less than the balloon payment (less any deductions for condition/mileage).

3. Normal Part Exchange (with any make/any dealer). The car will be valued for condition and mileage, but there will be no excess mileage penalties, as such. The dealer will resolve the old finance as part of the transaction.

4. Sell the car and pay off the finance. (This one may have requirements from Ford that you would need to satisfy). It's best done with a reputable dealer or someone like WeBuyAnyCar. There might be money to pay, with the high excess mileage or if the condition of the vehicle is poor.

5. Pay the Balloon payment and keep the car.


Under the circumstances, I would be looking for a trade-in. It doesn't matter if the new car isn't priced significantly higher than your trade-in. Take this route especially if you have been struggling to make the car payments up to now. If there is negative equity in the old car, the Dealer *might* be able to structure the transaction to help reduce or eliminate this.

You *should* find it easier to borrow against a car than simply as a free-standing loan. (This may have been the problem with continuing with the Ford finance).

bigfoot371

Check your eligibility for a personal loan or credit card to pay the balance and ensure you have your repayment plan well scheduled.

I think moneysupermarket can match your credit history to likely lenders.

Could a member of family help you if you agreed a payment plan?

Fireflyaway

Is it really £6000 if you hand the car back? Seems very steep. We handed our car back with no penalty as we had paid off 50% of the total that was allowed. It wasn't a lease though.
I'd check again.
If I were in this situation I would find a buyer if that's allowed and then find the difference and buy myself a very cheap runaround cash.

Cornucopia

Even at the OP's very high rate of 20p per mile, that's 30,000 miles - so not exactly an accidental oversight.

If the mileage rate is actually a more reasonable 7.2p (as shown on Ford's website), then it's 83,000 miles. :eek: