Getting out of a HP

kknd_cf

Hello,
I bought a van last June and my situation has changed and I no longer need it. It's a Nissan NV200 with 82,000 miles on it. the settlement figure on the van is £7744 and I have only paid in £1690 so far. I have spoken to the original dealer about them buying it back and he said it doesn't look great but will call me back after corona has died down when they are buying vehicles again.

I really don't need an extra vehicle anymore. Is there any clever way out of this?

Thanks

foxy-stoat

If you can pay back half of the full price then you could try and VT it.
Get a valuation from webuyanycar and pay the difference if its worth less than the settlement figure.

kknd_cf

Is VT voluntary termination?

neilmcl

kknd_cf said:

Is VT voluntary termination?

Yes it is.

kknd_cf

foxy-stoat said:

If you can pay back half of the full price then you could try and VT it.
Get a valuation from webuyanycar and pay the difference if its worth less than the settlement figure.

Webuyanycar values it at £3175. Which leaves £4569 left over. Are you saying sell it and pay the £4569? If so I have no chance.

AdrianC

I've heard elsewhere that WBAC offers have plummetted recently. No great surprise, really...

Basically, you are in massive negative equity on the vehicle. You owe £7,744 to the financier, but the van is only worth what it's worth. Depreciation has bitten hard due to circumstances outside your - and the financier's - control.

What was the total amount borrowed? I'm going to guess from your figures that it was somewhere around £9k? If so, then when you reach £4,500 repaid in total, you can voluntarily terminate the agreement. You've paid ~£1,700, so you would need to pay them £2,800 more. Yes, it's a lot. But it's a lot less than £4,569.

DrEskimo

kknd_cf said:

foxy-stoat said:

If you can pay back half of the full price then you could try and VT it.
Get a valuation from webuyanycar and pay the difference if its worth less than the settlement figure.

Webuyanycar values it at £3175. Which leaves £4569 left over. Are you saying sell it and pay the £4569? If so I have no chance.

I've read comments about valuations from WBAC plummeting in recent days due to the wider issues. Perhaps worth getting trade quotes from local garages/dealers, or looking at this again when this current situation subsides.

But in general, you have two choices. Pay to get to the VT (50% of the total payable amount, which will just be half way through a HP agreement) or pay the difference between the settlement and the trade in value. Which ever is cheapest is the better option.

kknd_cf

AdrianC said:

I've heard elsewhere that WBAC offers have plummetted recently. No great surprise, really...

Basically, you are in massive negative equity on the vehicle. You owe £7,744 to the financier, but the van is only worth what it's worth. Depreciation has bitten hard due to circumstances outside your - and the financier's - control.

What was the total amount borrowed? I'm going to guess from your figures that it was somewhere around £9k? If so, then when you reach £4,500 repaid in total, you can voluntarily terminate the agreement. You've paid ~£1,700, so you would need to pay them £2,800 more. Yes, it's a lot. But it's a lot less than £4,569.

Cash price of van was £8668 and total amount with interest was £11358.
By the way really impressed with the speed and helpfulness of replies, what a forum.

DrEskimo

Based on your figures, you need to trade the car in for ≥£3755 for it to be cheaper than VT. Looking at prices, I suspect that's a terrible amount of depreciation to pay.

My advice is, unless you can get a garage to give you a better trade price despite the situation, don't bother paying to get to the VT. You might as well pay it monthly and keep the car until you get half way through the agreement. Costs the same either way!

By that point, hopefully things will start going back to normal, but which point you will likely find the car is worth more than you owe, so would trade if rather than VT.

Basically, timing isnt great and your options to get rid early aren't very attractive financially. Better off just keeping it for now...

kknd_cf

Yeah it does seem that way, I am going to SORN it for a year whilst I am living close to work and wife is on maternity, then it could be back to the commuting lifestyle anyway. Thanks everyone for your help

DrEskimo

kknd_cf said:

Yeah it does seem that way, I am going to SORN it for a year whilst I am living close to work and wife is on maternity, then it could be back to the commuting lifestyle anyway. Thanks everyone for your help

If you are going to SORN it to save on tax and insurance, I would just double check your HP contract.
It might stipulate that the car has to be taxed and insured for the entire duration of the agreement....