Car Finance Agreement after seizure/surrendering license

Craig_1988

Hello

Posting on behalf of a family member that I'm going to try and help with the following situation.

He got a car on a 5 year finance agreement in April and a couple of weeks ago had a seizure. First seizure in his life but doctors have written to the DVLA and advised he must surrender his license for 6 months after which it will be reviewed. He had the seizure while driving, fortunately he was stationary at traffic lights but the car did roll in to a wall and caused some damage.

What are his rights in terms of cancelling the finance agreement? He would like to repair the damage and return the vehicle, but I am not sure if he would be liable to pay the full interest amount on top (circa £5k). 

There is a stipulation in the finance documents that he is in breach of contract and the contract will terminate if he doesn't keep the vehicle insured. The insurance is due for renewal in 1 month and I'm guessing he will be unable to insure it having been told he is unfit to drive and surrendering his license. So maybe this is a route out, but feels too simple.

Appreciate any thoughts...

Many thanks.

shiraz99

What type of finance agreement is it, HP, PCP, loan?

The fact he can't drive doesn't stop him from being able to insure the car and even if failed to do so would not be a "get out" of the agreement, he would still be liable for the cost of the car.

Alderbank

So your relative bought a car 6 months ago on finance (perhaps HP or PCP, we don't know).

As long as he owns the vehicle he has to keep up the payments, regardless of who actually drives it. Also as long as he is the registered keeper he must comply with the law regarding insurance, MOT and car tax. He doesn't have to drive the car himself, it could be used by his partner or another family member, or even not used at all. It doesn't matter as far as the finance is concerned.

However you say he now wishes to sell it. That's not a problem. Used car sales are still quite healthy. He can't just return it, but the dealer he bought it from will certainly make him an offer as will many other companies such as WeBuyAnyCar. They will sort out the finance.

Losing his license does not give him any special rights in law.

km1500

Agreed - sell the car and use the money to pay back the finance.

TELLIT01

He may also be able to drive again in 6 months if there is no repeat of the seizure.  Is it worth keeping up payments and, if nobody else is going to drive the car, parking it on the drive and SORNing it to avoid the road tax?

Craig_1988

Thanks all. Should have said, it is a Hire Purchase agreement. Yes my suggestion has been to hang on 6 months and decide then. If he sold the car now and had to pay the finance he'd be 1000s out of pocket - the finance was at a high rate due to prior CCJs. He tends to be a bit impulsive and thinks he can just give the car back and say "not my problem".

Thanks again.

shiraz99

Craig_1988 said:

Thanks all. Should have said, it is a Hire Purchase agreement. Yes my suggestion has been to hang on 6 months and decide then. If he sold the car now and had to pay the finance he'd be 1000s out of pocket - the finance was at a high rate due to prior CCJs. He tends to be a bit impulsive and thinks he can just give the car back and say "not my problem".

Thanks again.

Well he can, but not until he's paid off 50% of the total amount payable (ie, Voluntary Termination).

Manxman_in_exile

shiraz99 said:

Craig_1988 said:

Thanks all. Should have said, it is a Hire Purchase agreement. Yes my suggestion has been to hang on 6 months and decide then. If he sold the car now and had to pay the finance he'd be 1000s out of pocket - the finance was at a high rate due to prior CCJs. He tends to be a bit impulsive and thinks he can just give the car back and say "not my problem".

Thanks again.

Well he can, but not after he's paid off 50% of the total amount payable (ie, Voluntary Termination).

Have you missed out the word "until" from that reponse?

shiraz99

Manxman_in_exile said:

shiraz99 said:

Craig_1988 said:

Thanks all. Should have said, it is a Hire Purchase agreement. Yes my suggestion has been to hang on 6 months and decide then. If he sold the car now and had to pay the finance he'd be 1000s out of pocket - the finance was at a high rate due to prior CCJs. He tends to be a bit impulsive and thinks he can just give the car back and say "not my problem".

Thanks again.

Well he can, but not after he's paid off 50% of the total amount payable (ie, Voluntary Termination).

Have you missed out the word "until" from that reponse?

Yes, fixed it now.