Car finance - Black Horse - VT and GAP

jimrc80

Hi all.

2 points to raise:

1/
I am having to let me car go back soon because COVID19 has stopped my income.

Ive had a letter from Black Horse saying if you terminate your agreement before your next payment is due then you have to pay the sum of £375, which includes sums owed.

Ive already put payment back twice as I couldnt afford so been charged £70 for them to do that.

Here is my breakdown if anyone can share any light/advice?

Halves value £11,451
Total paid £ 14,389
Total fees £70
2nd Schedule Amount Outstanding £305
Total liability £375

It says as I have paid more than half total amount back my liability consists of fees and the remainder of your second schedule(where applicable)

This second schedule is confusing me, what is it? I assume its the GAP payment - Am I liable for this as once the car has gone what is the GAP against?

2/

I can deliver the car back to them free of charge but the nearest auction house is 30 miles away and closed due to COVID19
or
I can have it picked up for £75, although they are not currently operating.

The car insurance runs out soon so wont be insured for either.

Can anyone offer any help for both questions please?

Many thanks

DrEskimo

1/ I wouldn't know what it is, I would seek clarification from them.
If it is GAP, you are still liable to pay it. You took out a policy for £X, and then borrowed the money within this agreement to pay it. Most policies will provide a pro-rata refund on months not used, but I suspect that amount includes that. As such, it is still owed, as you had it for the duration of the time you had the car.

My advice is next time do not get GAP from a main dealer and buy online (far cheaper and more comprehensive), and certainly don't borrow it within the finance agreement.

2/ There are lots of posts and unknowns about this. Read your contract, as it may be a requirement to have the car insured, even though you have terminated the agreement. You will then just have to wait till they are open again.

sheramber

Ask the finance  company what it is and what happens about insurance.
 An earlier post indicated that the finance company insured the car from the date of hand back.

jimrc80

Thanks for the replies.
With regards the insurance, that ends 1st June, I simply wont be able to afford to insure it again as its commercial insurance and quite expensive, with no income (other than Universal Credit) its impossible.

Ive also read that I shouldnt sign their VT paperwork as it boldy states I may be liable for additional costs once they have received the vehicle come inspection.

I will draft my own VT paperwork and re-submit for you to have a look at.

Thanks.

jimrc80

Hi - Please see my draft VT letter below, any advice welcome.

Black Horse Finance
Collections
2nd Floor
Ettrick House
37 South Gyle Crescent
Edinburgh
EH12 9DS

Date:
Registration -
Agreement No
Termination letter under S.99(1) of the Consumer Credit Act 1974
 
Dear Sir or Madam,
 
Termination of hire-purchase agreement in accordance with section 99(1) of the Consumer Credit Act 1974 (“CCA 1974”)
 
I am writing to inform you that I am exercising my right to terminate the above hire-purchase agreement with immediate effect in accordance with Section 99 of the CCA 1974. The reason for terminating the agreement is because I am experiencing financial difficulties due to COVID-19 and it is no longer possible to keep up with the repayments. Under Section 100(1) of the CCA 1974, my liability is limited to one-half of the total price payable which, according to the terms of this agreement, is £11,451.30. As at today’s date, I have paid £14,389.03 and I am therefore no longer required to make any further payments. 

I have also inspected the vehicle and I am of the opinion that it is in a reasonable condition given its age whilst accounting for fair wear and tear. Photographic evidence has been taken in the event of any future dispute as to the state of the vehicle. The vehicle is available to collect from the above address on giving reasonable notice, otherwise if you prefer to have it delivered to another location, I am willing to consider this provided that you agree to pay my reasonable costs and expenses. Please note the vehicle is insured up to 1st June 2020 only.

Please note that this termination letter is in respect of the hire purchase only. I am aware that I also took out GAP insurance at the same time but I do not wish to terminate this arrangement. I will continue to pay the monthly instalments of £11.34, although I will need to set up a new direct debit because the existing one included the hire purchase and insurance instalments together as a single monthly payment.

I would appreciate if you could contact me on email above within the next 14 days to discuss the next steps.
 
Yours faithfully,

 

DrEskimo

What was the price of the GAP on the original invoice? How long have you had the agreement and been paying towards this GAP policy?

jimrc80

£544.32 Ive paid 22 out of 48 installments

cranford

Would a 3 month payment holiday help?
https://www.blackhorse.co.uk/contact/coronavirus-support

jimrc80

No, already put the payment back twice

angrycrow

Don't you have to be up to date with payments to vt. Does the £305 correspond to the overdue payments. 

DrEskimo

jimrc80 said:

£544.32 Ive paid 22 out of 48 installments

Sorry, I mean how much was it to just buy at the start of the agreement?