Car finance voluntary termination

Shaunnng

Hi sorry if this has been put before but I could not find it, last year I took out a high interest car finance with MoneyWay. The car was valued at 8000 and the agreement was for 60 months totalling 14000, within 12 months I was made redundant, and was given the option to either voluntary terminate and pay upto the 50% agreement value or wait and get the car collected and owe them over 10,000. Obviously panicking I chose the first option, but now I'm working again I'm wanting this debt cleared, do I have any right to appeal this as they got nearly 3000 in payments, the car back within 12 months, and demanding 5000 extra to compensate, as this means within 12 months I've managed to pay/owe 8000 and give the car back as well, any help will be appreciated as it's very stressful, thanks

BoGoF

In a word......no.

foxy-stoat

If you can get a loan for say £7500 offer them this as a full and final settlement - chances of you getting further credit with defaults from the original lender are going to be slim so ask them for a realistic payment plan - with a bit of luck they wont charge you interest and you can start to pay down the debt.

Or pay nothing for 6 years and it will be unenforceable.

MEM62

You were pretty much sunk from the point where you decided to pay £14,000 for an £8,000 car. If you are now employed and in a position to secure a loan with a better interest rate that that applied to the car finance the you may be able to settle the finance this way and save a little interest.

National_Debtline

Hi Shaunnng


It sounds like your car was on hire purchase (HP). That means if you terminated the agreement the creditor was allowed to hold you liable for 50% of the original agreement minus the payments you had already made.


If a creditor terminates a HP agreement they will hold you liable for 100% of the original agreement minus the payments you have already made, minus the amount they get for selling the car at auction.


You have gone for the option that has left you with the smaller debt but unfortunately you will remain liable for this. One of the downsides of a HP agreement is that you can be left with a large debt if you cannot afford to maintain the payments for the whole of the agreement.


If you need help dealing with the amount you still owe post in the Debt Free Wannabe board or contact one of the free debt advice agencies for advice.


Best wishes


Susie
@natdebtline