Please help me to understand the logic of my MoneyBarn Disaster?

handco

Hello,

This is my first post, I am finally trying to deal with this situation, forgive me if after reading the other threads / rules I make a mistake or something that I say is not in-line with how it's usually done around here.

I took out a MoneyBarn loan in March 2016 that I never really should have, my credit situation was not fantastic but I didn't have any bad markers, I was given a contract that was for 15,000 pounds at an interest rate of 39.1% to be paid over 60 months. for a total payable of around 32k

Unfortunately due to my own very poor management of finances whilst i was continuously out of the country for work, I fell behind with the payments to MoneyBarn, the car had broken several times and cost me 2k+ on more than two occasions. the car was reposessed from me in late 2017 (November) & sold at auction for 11k, I believed a market value of closer to 15k was possible as I had actually paid a larger cash deposit in the first place to get the car.

I'm coming back to the country now and want to take care of this properly

The current outstanding balance on the agreement is now 14,300, but what I can't understand is. What am i paying the 14,300 for? I don't get the car back after it's been paid, It makes no sense to me, Moneybarn took their car back & have been paid around 17k totally But i owe them another 14k for the privellege of having rented their car for just over a year?

Is this really how it works?

The contract is still green on my credit file & I don't really have any other debts, but i want to make this high balance come down so I thought about doing an early settlement, I understand i can shave a few k off if i do this now whilst there's still around 2.5 years on the contract.

Thank you for any suggestions or experience you may have.

foxy-stoat

If you Voluntary Terminated the agreement and handed the car back you had paid 50% of the agreement you shouldn't have any more to pay - unless you defaulted on the loan a few times, then they repossess and charge you what you should of contractually paid.

I would time your return to the UK 1 month after 6 years after the last time you acknowledged the debt.

handco

Thank you but unfortunately staying away for so long, is impossible.

There was never any default notice listed on my credit file, no court order was made for the reposession I did agree to hand it back at their request but I'm not really sure if it's considered "voluntary"

Otherwise, I'm on the hook for another 14k? what seems illogical to me, is that I pay 32k totally.. but where is the car? what do i get for that 32k except a year of driving a middle of the range hatchback?

[Deleted User]

Where are you getting the figure owed of 14k from?

If your credit files, that probably won't be the figure owed.

handco

From the moneybarn website, granted there may be a small rebate for early settlement.

Gaz83

handco wrote: »

Thank you but unfortunately staying away for so long, is impossible.

There was never any default notice listed on my credit file, no court order was made for the reposession I did agree to hand it back at their request but I'm not really sure if it's considered "voluntary"

Otherwise, I'm on the hook for another 14k? what seems illogical to me, is that I pay 32k totally.. but where is the car? what do i get for that 32k except a year of driving a middle of the range hatchback?

It may seem illogical, but this is what happens if you default on a loan agreement.

They agreed to lend you £15,000. You, for whatever reason, agreed to repay them £32,000. You didn't keep to your payments, so they've sold your car and used the proceeds to offset the amount you owe them. This amount didn't cover the full outstanding balance, so you need to pay them the rest.

That's about it.

handco

I certainly understand that,

But it's not exactly accurate, the car was provided in exchange and as security for the payments, the car was taken back & I am to complete the term but receive nothing? I pay 32k to rent a VW golf for one year, legally binding contract or not, I almost feel like there would be a reasonable argument in court about something like this.

At the end of all of this, If i have to wear this 14k & learn my lesson then so be it, I have the money. I can't say it's "unfair" it just seems quite "unclear"

The contract states that If i have paid above 16k I can terminate the agreement & it ends, But if they do the same I'm not entitled to this same freedom?

I had the money to pay for the car at the time, I took the finance because the salesman told me that it's what everybody does these days, It was my first finance agreement at 26 years old & I can't pretend I thoroughly understood it.

handco

I've just realised that i neglected to mention the car was provided to me on conditional sale & not a simple "loan" as I said before.

DCFC79

How did you fall behind with payments ?


Was a DD not setup ?

-taff

handco wrote: »

But it's not exactly accurate, the car was provided in exchange and as security for the payments, the car was taken back & I am to complete the term but receive nothing?

Yes, because your agreement was to pay them back at an extortionate, yet legal, rate of interest which agreement you defaulted on.

handco wrote: »

The contract states that If i have paid above 16k I can terminate the agreement & it ends, But if they do the same I'm not entitled to this same freedom?

You defaulted on the agreement which means they were entitled , by the terms of your agreement, to recoup their money.


Next time, as you say you have the money or had the money, just buy a second hand car from mobility auction sales or similar...Much cheaper , no hassle.
And it really doesn't matter what age you are, you chose to go into this agreement not understanding exactly what it was for. You are responsible for your own choices and you didn't uderstand what you were doing through ignorance. Don't do that again, read up more on the types of finance agreements you could have in the future if you want to do that again.

foxy-stoat

The only thing that is illogical in your situation is that you used a 39.1% interest rate to finance a secondhand car.

If you had to spend £2,000+ on 3 or more occasions to fix the same fault you should of taken back then.