Car finance/insurance predicament!

Liam1010

Hello,

I am looking for some advice on the best way to get out of my tricky situation.

Last year I took out a car on a 4 year HP plan in my first year of driving, my insurance was cheap and the first year has been great. Although a few months ago I had a small accident when I bumped into the back of a third party, who claimed for repairs.

My insurance renewal is December 1st and I cannot get insured for under £350 a month unless I get a 10,000 limited telematics insurance policy. The problem with getting insured is that I am 20, with no NCB, a 2.0lt car and will be doing around 18,000 miles per year due to my job - so a 10,000 miles a year policy is out the window.

My best option is to sell the car, buy a smaller engined car and get cheaper insurance. Which would be perfect expect that I am £1500-£2000 in negative equity as I have only made 11 payments. I cannot afford £2000, especially just before Christmas and am struggling to find a solution, I don't think I will be eligible for a loan due to my age and I just feel at a dead end.

Is it possible to part-exchange the vehicle, and add the negative equity onto the finance of the new car?

Does anyone have any advice? Thanks in advance.

MataNui

Liam1010 wrote: »

Hello,

Is it possible to part-exchange the vehicle, and add the negative equity onto the finance of the new car?

This may be possible (there are plenty of posts on these boards from people who have done similar - and regretted it) although its a monumentally stupid thing to do. Its also unlikely to work out cheaper (in terms of payments) than paying the extra for the insurance.

If you do look at this you are in any case just rolling a bigger problem down the road a year or two. Thats assuming you dont make any more driving errors or stupid financial decisions. Once more little insurance issue and you would basically end up screwed. Be sensible. Bite the bullet and deal with it now. You clearly over extended financially in the first place.

DCFC79

Can I ask why does christmas being next month mean you cant afford £2000 ?

Im sure you part ex the car, does your agreement mention anything about it ?

middleclassbutpoor

Have you tried negotiating with the insurance companies to see if they can lower this or have you just relied on the comparison websites. Without knowing what you have done so far, its difficult to say but my approach would be to follow the insurance guide on here. https://www.moneysavingexpert.com/car-insurance/

If you live with parents have you tried naming them as 2nd named drivers to bring the quote down? Have you asked who they are insured with to see if you could qualify for further discounts?

Im not sure how this works but would it be worth getting some short term cover to buy you some time - just google short term car insurance.

The other option would be to go and do a statement of affairs on the debt free wannabe board and see if they can help make the cover affordable by helping you understand where you can cut back in your expenses to avoid the need to go into negative equity with the car.