car Voluntary terminate - does it effect the scoring

Stevepd

Hi all.

I’m over the 50% mark of my HP agreement with Close brothers finance. Circumstances have changed and the car is very likely in negative equity. My question is if I return the car to the company will it effect my credit rating?. I have no idea, never done it before and in my circles nobody has done it.

The is in good order, serviced and relatively low miles so I have no qualms about the car being an issue.

[Deleted User]

Your files will simply show that the agreement has been settled.

molerat

The account will likely be marked VT which may or may not affect your ability to get further car finance.

TrainDriver

Stevepd wrote: »

Hi all.

I’m over the 50% mark of my HP agreement with Close brothers finance. Circumstances have changed and the car is very likely in negative equity. My question is if I return the car to the company will it effect my credit rating?. I have no idea, never done it before and in my circles nobody has done it.

The is in good order, serviced and relatively low miles so I have no qualms about the car being an issue.

Take photos of every panel on the car, the wheels, the interior, the boot and the engine bay because they almost always attempt to claim for damages and if you have photographic evidence then it’s easier to prove no damage existed.

You can get voluntary termination template letters and all you do is fill in the blanks relative to your car but whatever you do make sure it is voluntary termination and not a voluntary surrender or you’ll be liable for any shortfall of finance owed after the car is sold at auction.

Nearlyold

It won't affect your credit rating as such, however if VT rights are important to you, check your paperwork carefully before you sign any future car finance docs as a lender may decline to offer you HP and switch you to a fixed sum/term agreement instead (which doesn't have VT rights). The finance company will have informed the dealer of the change to the type of agreement but the dealer might "forget" to tell you.