Can I VT my fiat

mrmcox

Hi guys, I am new to the site, and have read a bit about VT a car finance agreement, but really not sure how it works, if I can do it, or even if its worth doing...So Im looking for a little advice...

I purchased a new fiat on 21st Aug 2015 on a 4 year PCP deal. The car is great and I love it, but it is no longer practical for what I need. I've looked through the credit agreement, and can't see anywhere where it mentions anything like Voluntary Termination.
From my credit agreement, I have the following figures,
Cash Price 16,302
Advance payment 2000
Amount of Loan 14,302
Total charge for credit 1821.92
total amount payable 18,123.92
APR 4.8%
47 monthly payments of 239.36
and final balloon payment of 4874
If I could VT the car, when would this be possible, as Im not sure which figure I need to have paid 50% of.

Any help appreciated...

BoGoF

My understanding is that it will be 50% of the total amount payable plus the balloon payment.

So 18124 + 4874 = 22998

50% = 11499

motorguy

Ok, heres my thinking of those figures.

Total amount payable is £18,123.92.

Half that is £9,061.96

You, or somebody (maybe FIAT finance?) have paid £2,000 in to the deal, so you need to make £9,061.96 - £2,000 = £7061.96 of payments to have reached the 50% marker.

Your monthly payment = £239.36, therefore you need to make 29.50 payments (rounded up = 30 payments) before you have paid over 50% of the deal, which means you'll need to be 2.5 years in.

You can VT at any time, however they can recoup 50% of the total transaction cost, so the difference between the payments you have made and £7061.96 would become payable now.

HTH

motorguy

BoGoF wrote: »

My understanding is that it will be 50% of the total amount payable plus the balloon payment.

So 18124 + 4874 = 22998

50% = 11499

No.

The balloon is included in the total amount payable (hence why they call it "total" )

If you total it up £2,000 advance payment / deposit + (47 * £239.36) + £4,874.00 = £18,123.92

(I suspect the residual payment is actually £4874.08)

mrmcox

motorguy wrote: »

Ok, heres my thinking of those figures.

Total amount payable is £18,123.92.

Half that is £9,061.96

You, or somebody (maybe FIAT finance?) have paid £2,000 in to the deal, so you need to make £9,061.96 - £2,000 = £7061.96 of payments to have reached the 50% marker.

Your monthly payment = £239.36, therefore you need to make 29.50 payments (rounded up = 30 payments) before you have paid over 50% of the deal, which means you'll need to be 2.5 years in.

You can VT at any time, however they can recoup 50% of the total transaction cost, so the difference between the payments you have made and £7061.96 would become payable now.

HTH

Thanks for the info....I wasnt sure if they took the advance payment into consideration. So I need to have made 30 monthly payments to VT without having to pay anything else....Which means Im gonna have to keep the car for another 5 or 6 months...Which isnt a problem as I like the car, its just not as practical now as it could be..

How do I go about starting the VT when the time is near ? Is there a "template" letter I can download and use ?

Also if I do VT, will it stop me getting car finance in the future ?
Thanks in advance

bazzyb

mrmcox wrote: »

Also if I do VT, will it stop me getting car finance in the future ?
Thanks in advance

The VT will be marked as such on your credit file and so lenders will be able to see it when making decisions in future. Some lenders don't like it, but many aren't bothered at all.

So it could make it slightly more difficult to get car finance in the future (some lenders may decline or impose restrictive terms) but if you have reasonably ok credit history it shouldn't stop you from getting car finance completely.

neilmcl

mrmcox wrote: »

Thanks for the info....I wasnt sure if they took the advance payment into consideration. So I need to have made 30 monthly payments to VT without having to pay anything else....Which means Im gonna have to keep the car for another 5 or 6 months...Which isnt a problem as I like the car, its just not as practical now as it could be..

How do I go about starting the VT when the time is near ? Is there a "template" letter I can download and use ?

Also if I do VT, will it stop me getting car finance in the future ?
Thanks in advance

A template letter can be found here - https://www.citizensadvice.org.uk/debt-and-money/sample-letters-to-creditors/Ending-a-hire-purchase-or-a-conditional-sale-agreement---letter/

or http://www.legalbeagles.info/forums/showthread.php?94449-Template-letter-for-voluntary-termination-of-a-PCP

One thing to take special note of is not to sign any documents you might receive from the finance company once you enact your VT, your letter is all that you require to fulfil your legal obligation.

motorguy

mrmcox wrote: »

Thanks for the info....I wasnt sure if they took the advance payment into consideration. So I need to have made 30 monthly payments to VT without having to pay anything else....Which means Im gonna have to keep the car for another 5 or 6 months...Which isnt a problem as I like the car, its just not as practical now as it could be..

How do I go about starting the VT when the time is near ? Is there a "template" letter I can download and use ?

Also if I do VT, will it stop me getting car finance in the future ?
Thanks in advance

Yes, find a template letter, DONT SIGN any letters or "VT Packs" the finance company send you either.

It wont stop you getting finance. It puts a marker on your file, but i dont think any finance company really gives a monkeys.

We've VT'd twice - first time, the finance company sent us a letter thanking us for the business and asking us to get in touch in the future if we needed finance, and the second time we bought another same brand car with the same finance company.