CVL then Bankruptcy - Car worth less than HP outstanding

BlueSkySeas

Thoughts very welcome. My company is insolvent and is presently going through a CVL. I have no significant assets I think, however, many of the company debts are personally guaranteed, so bankruptcy is next. 

I am going to be a contractor for another company (not mine) with a Weekly income of £650 - I have a Monthly military pension of around £300 

Car is on HP and the settlement figure is £11,700
It has done over a 123,000 miles and webuyanycar have it valued at £9,800
I need a mile muncher for work.
What if any are the options to keep the car?

Thanks.

MEM62

If the loan is secured on the car you will likely loose it as your bankruptcy will prevent you from keeping up the payments.  

BlueSkySeas

MEM62 said:

If the loan is secured on the car you will likely loose it as your bankruptcy will prevent you from keeping up the payments.  

Thanks, that makes sense.

Minkym00

It's not quite as simple as that. The car is not an asset as there is no equity in it, therefore the Official Receiver will disclaim it. If the monthly repayments are reasonable then the OR will likely allow them as an expense. It then becomes a matter between you and the finance company. If the finance company doesn't care that you're bankrupt as long as you to continue making the payments then you carry on, and keep the car. Some finance companies consider a bankruptcy as a breach of their terms and will repossess. The car is then sold and the shortfall becomes another bankruptcy debt. So there is no hard and fast answer.    

BlueSkySeas

Minkym00 said:

It's not quite as simple as that. The car is not an asset as there is no equity in it, therefore the Official Receiver will disclaim it. If the monthly repayments are reasonable then the OR will likely allow them as an expense. It then becomes a matter between you and the finance company. If the finance company doesn't care that you're bankrupt as long as you to continue making the payments then you carry on, and keep the car. Some finance companies consider a bankruptcy as a breach of their terms and will repossess. The car is then sold and the shortfall becomes another bankruptcy debt. So there is no hard and fast answer.    

Many thanks, that gives me some hope that I can keep the car, I will request an arrangement from the OR and the finance company, fingers crossed. Cheers.