Car finance on mat pay

albelmel

Hi all!
I bought a car two years ago with Arnold Clark and in 6 months I need to pay the full amount which is 9k or return the car. 

I’ve just started my maternity leave and I’m going to get my salary at 90% for 3.5 months(£2000/month), then it’s the pay from the government (£600/month) so by the time I need to pay the car or return it I’ll be almost ending my maternity leave and getting only £600.

My current loan is £155/month, my credit score is quite good I can still pay the car with the £600 but I’m worried if I decide to get another car or ask for a new loan they’ll reject it as I’m won’t be working and I’ll end up without a car.

Do you think it’s best to refinance the car now that I still have full payslips or just wait until the deal ends in 6 months?

Thanks

[Deleted User]

You'll be expected to declare your imminent reduction in income, so it will make little difference. 

You could return the car and buy something a lot cheaper from savings, so you're not tied to ongoing payments or balloon payments.

[Deleted User]

Don't worry about the fake credit "score"

Can you return the car and get a cheaper runaround? Loan would have to be done on your predicted income i.e. the SSP

Can you save up in the mean time or ask AC if they could consider finance for you to extend for a year to pay it off?

Sncjw

Would the child's father not help with getting a car if you are still together? 

albelmel

@Sncjw my partner will be paying the mortgage and the house bills, don’t really want him to pay for my car too.

Thanks all for your input, I think the best is speak with AC I’m sure we can arrange something

MalMonroe

Hi, apart from the maternity leave, I'm in a similar position with my car except I've had it on a PCP for three years now and the agreement ends in August. 

I've been considering selling it - which my finance company (also the car dealer - Toyota) says is absolutely fine as long as they get their money back before or in August - either to another dealer or to one of those 'we buy your car' places. I've had offers from two of each for twice the price of my 'balloon' payment. Which would mean I could get rid of my car and buy something decent (although not as new obviously) with the profit from the sale. 

The car dealer also says that I could use my car as a trade in and they will give me a good deal - but then of course I'll be on yet another payment plan as from August, which I don't want.

It doesn't hurt to get a few valuations from places like 'we buy any car' - then you can see what people are prepared to pay. I'm getting similar valuations from those companies and also from one or two dealers. . .  
 
I figured that if I can sell my car like that, I'll make a reasonable profit, use that to buy something else and then I still have my savings and won't owe anyone anything going forward.

Another option is that you could contact the finance company, explain your situation and ask if they could offer you an extension to your agreement with lower payments. Always worth a phone call. They may have some other plans for you to consider.

If I were you I might just want to give myself a couple more months, don't panic because you are obviously a good customer for Arnold Clark to have, you are paying regularly and can also continue to pay regularly, in spite of the lower pay packet later on. You have a good job with a guaranteed income and are unlikely to default. 

I should add that not only am I single, I'm also a pensioner and I managed to get a good deal for myself with Toyota. I've paid on time, every time and now they say I'm 'loyal'. Which is good to know, even if I'm not all that loyal, really!  You're obviously in a much better financial position than I am so I really wouldn't worry too much.

I hope that's helpful.   Good luck.