Can a finance company terminate an HP agreement while still taking payments?

MargaretB_2

That's the question. I took out the hire purchase agreement on a car in April 2016 and until a few months ago, kept up the payments diligently. However, I have missed two payments this year (not consecutive payments) and the last payment was made on time.

I have a letter this morning telling me that the agreement is terminated (fair enough) and they want me to return the car. Now I always understood repossession couldn't be legally done after payment of two thirds of the price, but that's neither here nor there.

My question is as the title. Can they terminate the agreement and/or repossess the car when they are still taking payments by direct debit?

molerat

Are the missed payments still outstanding or have you paid them ? Once 1/3rd (of full contract amount) has been paid they cannot repossess without a court order and after issuing a default notice. If they do repossess without a court order you would likely be due all money paid refunded. That they are still taking payments is irrelevant as that could be considered rental payments whilst you are in possession of the car - I assume it is actually the borrower that has got the car.

MargaretB_2

molerat wrote: »

Are the missed payments still outstanding or have you paid them ? Once 1/3rd (of full contract amount) has been paid they cannot repossess without a court order and after issuing a default notice. If they do repossess without a court order you would likely be due all money paid refunded. That they are still taking payments is irrelevant as that could be considered rental payments whilst you are in possession of the car - I assume it is actually the borrower that has got the car.

Yes, I have the car and no, the two missed payments haven't yet been paid. I've had no notification that the payments they are still taking are rental payments, which would mean they are not being credited toward the outstanding amount. Wouldn't they have to inform me of that change?

I had every intention of catching up, but since I have a letter saying the agreement has been terminated, I'm not sure what to do about that.

molerat

Whilst you are in possession of the car you need to continue making payments. You owe those missed payments so in any case, even if they have terminated. You need to get those missed payments caught up then they will be unlikely to be awarded a court order.

MargaretB_2

molerat wrote: »

Whilst you are in possession of the car you need to continue making payments. You owe those missed payments so in any case, even if they have terminated. You need to get those missed payments caught up then they will be unlikely to be awarded a court order.

Thank you. I have no intention of stopping payments provided they are going towards the balance and I have every intention of catching up. I want to change this car later this year, though, and I don't want it tied up in an HP agreement that isn't going away.

[Deleted User]

MargaretB wrote: »

Thank you. I have no intention of stopping payments provided they are going towards the balance and I have every intention of catching up. I want to change this car later this year, though, and I don't want it tied up in an HP agreement that isn't going away.

Hope you plan on paying cash for another car as you won't be getting another on finance anytime soon.

MargaretB_2

camelot1971 wrote: »

Hope you plan on paying cash for another car as you won't be getting another on finance anytime soon.

I am. It was a big mistake taking out finance for this one as it has devalued so much since then. On reflection, I would rather have an older car that is cheaper. Before this, I had a little Honda Civic, W reg, which cost me £280 but was just as good as this one, but I was tempted.

norsefox

MargaretB wrote: »

I am. It was a big mistake taking out finance for this one as it has devalued so much since then. On reflection, I would rather have an older car that is cheaper. Before this, I had a little Honda Civic, W reg, which cost me £280 but was just as good as this one, but I was tempted.

The big mistake wasn’t taking out Finance on a car that devalued but on a vehicle you couldn’t afford.

MargaretB_2

norsefox wrote: »

The big mistake wasn’t taking out Finance on a car that devalued but on a vehicle you couldn’t afford.

Oh, how I love you superior types who have never missed a payment. Since I've never missed a payment in the first two years, I would say I could easily afford it. The fact that I missed two, not consecutively (that means one after another, without interruption) two months ago and five months ago, doesn't detract from that. My reasons are none of your concern and irrelevant to the question I originally asked.

I would like to thank the poster who gave me sensible advice and help. As to the others, well, I suppose they have to make themselves feel important somehow.

Edi81

But you are still missing two payments. You seem to be oblivious of that fact.

User_101122

Can a finance company terminate an HP agreement while still taking payments?

Yes, you are two months in arrears and it does not matter that you are making payments still. The fact is you are two months in arrears.

would like to thank the poster who gave me sensible advice and help. As to the others, well, I suppose they have to make themselves feel important somehow.

Translates to: Thank you to everybody who told me what I wanted to hear, and screw anyone who told me the situation as it is.

Ditch your attitude and take control of the situation. Your Agreement has been terminated meaning that the vehicle is at risk of either repossession or a return of goods order. Phone them today and make an arrangement that you can afford to stick to. When you speak to them don't throw your toys out of the pram and get all defensive when they tell you something you didn't like the sound of and don't agree to pay them more than you can afford.