Pcp vt

evensis

Hi,

Very much value the opinions of the forum members on MSE, so thought I would chuck this question here!

So long story short, I needed a new car as the family has expanded somewhat and my children have been sat cramped in the back of my current car (since the addition of a car seat!) which is on a PCP plan . Essentially the car is no longer fit for purpose and went out to see what I could find that would fit everyone in comfortably.

Having found an appropriate car and being relatively clued up on voluntary termination, I mentioned this to the salesman selling the car I was after (as there was quite a large amount of negative equity on the current vehicle of which I have no intention to take on), and after a phone call to the finance company it turned out I am 3 months off the 50% mark. A payment is going out on the 1st of next month which brings it down to 2 months. The dealership will be giving me a check of £800 to pay off the remaining finance on the vehicle and bring it up to the 50% mark in order to VT it. Although they made no mention of whether or not I will have to keep it for the remaining time (and use the supplied check to pay it off over that period) or I can just lump sum pay off the vehicle to the 50% mark. Somewhat of a grey area for me that one and would love a bit of clarification!

However, it also raises further dilemmas. The vehicle in question is due for its first MOT next month (I am hoping to get the VT excess paid off and them collect it before its due), in addition, it's going to be hanging around as I will be getting my new car on the weekend, so the real question is do I need to keep it insured while I wait for the pickup and after the voluntary termination has taken effect? As I'm not able to transfer my NCB it's going to cost a small fortune insuring my new car. Reasonably sure the law is quite specific in that once terminated, I have absolutely no more liability associated with the vehicle. Although, I would feel remit in my duties if I left it on the road parked and uninsured. The dealership did mention I could leave it on their premises if I needed to.

Ultimately I don't want to get stung by the finance company, be that for the MOT or it being left uninsured on the dealerships premises?

Any help would be most appreciated.

fiisch

It will take about 2-4 weeks to VT the car. If the car is collected before MOT is due, you will not be liable. If the car is due an MOT prior to collection, you would have to get it MOT'ed (the car has to be road legal to drive away).

You also have to keep the car insured until collection (irrespective of the law, the finance companies stipulate this so that their insurance is valid for the courier to drive away). You will need to insure two cars in this instance, however many motor insurers offer a "temporary additional vehicle" under a single policy. This is intended for exactly this situation, but there is usually a limit (14/28 days) that they will do this for. It tends to cost around £30 a week.

Therefore, I don't think leaving the car at the dealer's premises uninsured or un-MOT'ed will be a valid solution, as the finance company will refuse to collect the vehicle on this basis.

If you're going to VT, highly recommend you read this article: https://www.thecarexpert.co.uk/car-finance-voluntary-termination-pcp-hp/

I VT'ed last year and did get some comeback, but ultimately didn't have to pay anything over and above what I had already paid.

Be aware that you will continue making payments up until the point the car is collected i.e.: if your payments come out one the 1st and the car is collected on the 2nd, you will be liable for that month's payment. If the reverse is true, you won't be....