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Terminating Car Lease Early on medical grounds - penalty charges & credit file impact query
shannahleanne
Posts: 9 Forumite
Good Morning
I am looking for some advice on termination charges on a car lease.
I recently took out a lease for a new car, at the time i did not have any issues with paying the monthly cost.
Unfortunately in December my health deteriorated and for medical reasons ive had to change my working hours on a permanent basis. This therefore left me no alternative but to review my finances. As the car lease was the biggest chunk of money each month i decided i needed to terminate the lease and take a loan out to buy another car outright.
I contacted the broker as the normal cost would have been in excess of £4000 to terminate, but given the circumstances they spoke to leaseplan who advised they could look at my case and review the options available to help my situation.
I sent across pathology reports and consultant letters confirming my problems and leaseplan gave the following options:
1. Pay the penalty in full and have no impact to the credit file
2. Keep the car and continue with the lease until 2022 and have no impact to the credit file (but struggle each month for 2 more years)
3. Amend the term of the lease to reduce the payments each month and have an arrangement noted on the credit file
4. Hand the car back and have an arrangement on the credit file to pay the termination charges over a period of time to suit my needs
I asked leasplan if they could offer to reduce the penalty given its a medical reason and they have stated even if they reduced the penalty and i paid this in full they would still put an arrangement marker on my credit file.
At no point did this company offer to help me in any way like they state they have tried to.
Which ever route i take im negativley impacted financially, and as i need to get another car and take out a loan to cover this, im unwilling to do anything that will affect my ability to obtain credit in the future, i have an excellent credit score and will not jeopardise this.
Yesterday I handed the car back and had to take out a loan to cover the penalty charge of £4000 + pay interest soon to be taken my direct debit.
Please can anyone advise if this is right - it doesn't seem right that if i was to pay an agreed reduced early termination fee in full and not over a period of time, that they can still slap me with a black marker / arrangement marker on my credit report.
I am looking for some advice on termination charges on a car lease.
I recently took out a lease for a new car, at the time i did not have any issues with paying the monthly cost.
Unfortunately in December my health deteriorated and for medical reasons ive had to change my working hours on a permanent basis. This therefore left me no alternative but to review my finances. As the car lease was the biggest chunk of money each month i decided i needed to terminate the lease and take a loan out to buy another car outright.
I contacted the broker as the normal cost would have been in excess of £4000 to terminate, but given the circumstances they spoke to leaseplan who advised they could look at my case and review the options available to help my situation.
I sent across pathology reports and consultant letters confirming my problems and leaseplan gave the following options:
1. Pay the penalty in full and have no impact to the credit file
2. Keep the car and continue with the lease until 2022 and have no impact to the credit file (but struggle each month for 2 more years)
3. Amend the term of the lease to reduce the payments each month and have an arrangement noted on the credit file
4. Hand the car back and have an arrangement on the credit file to pay the termination charges over a period of time to suit my needs
I asked leasplan if they could offer to reduce the penalty given its a medical reason and they have stated even if they reduced the penalty and i paid this in full they would still put an arrangement marker on my credit file.
At no point did this company offer to help me in any way like they state they have tried to.
Which ever route i take im negativley impacted financially, and as i need to get another car and take out a loan to cover this, im unwilling to do anything that will affect my ability to obtain credit in the future, i have an excellent credit score and will not jeopardise this.
Yesterday I handed the car back and had to take out a loan to cover the penalty charge of £4000 + pay interest soon to be taken my direct debit.
Please can anyone advise if this is right - it doesn't seem right that if i was to pay an agreed reduced early termination fee in full and not over a period of time, that they can still slap me with a black marker / arrangement marker on my credit report.
0
Comments
-
Yes, it's right, if you break the terms of the original agreement.
There is a difference between them agreeing to settle for less and not reporting the breach.
0 -
Sorry zx81, are you saying they can do this even if they reduce the penalty?0
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Yes, if the original agreement is breached (ie a short settlement).1
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