Car repossession shortfall

sunshine0123

Hi, I’m a newbie here so I’m sorry if this is wrong thread/details. I will be happy to go and read another thread about my issue.

My car has been repossessed back in October as I fell behind with payments. Agreed with the finance company they will collect the vehicle which they did. 
What I am struggling is that vehicle was sold for £45k and I still have £35 shortfall. I am so concerned, my business has closed down and I am going through a lot of financial stress. I got advice & budget from Payplan and at this moment I am in a “-“ and have no disposable income. I am only paying for priority debts but with those I already struggle. 

How do I address this?
I received the letter from lawyer saying I have 30 days to repay the shortfall but finance company was already presented with my financial situation.
The only asset I have is jointly owned house with my partner bought with Help to buy scheme. Can they come after the house?

What do I do?

Do I dispute the shortfall as the car was sold below market value at auction?
Do I admit to debt and present that I can’t afford even now to pay in instalments?
What do I say in Reply form? 
Thank you.

Keep_pedalling

Unfortunatly the depreciation on luxury cars is massive in the first couple of years. What sort of finance did you have? Was it personal finance or company?

sunshine0123

PCP with BMW Financial Services. I think I have to make peace with the auction price…very true what you say

ManyWays

That is a very large debt remaining. As this is so soon, I assume the solicitor is acting for BMW and that it hasn't yet been sold to a debt collector. 
How large are your other debts? How much equity is there in your house, that's current value less mortgage less the governments share? When does your 5 year mortgage fix end?

DullGreyGuy

Auction is a perfectly reasonable method of disposal, it avoids all the arguments of if they should accept an offer or sit on it for another X months all the time charging you interest on the debt and the asset depreciating or if they'd get more if they advertised here or if they invested money in referbing the alloys etc etc. 

May not get top dollar but its a reasonable reflection on the day, its quick and makes all numbers known rather than being based on estimates etc. 

A little surprised you can have a car with £75k of credit on it and qualify for a shared ownership property. 

Was the PCP in your name or was it a company purchase seeing as you mention a business? If the later did you give any personal guarantees to the credit?

sunshine0123

Responding to above
Market value of the house 300k
Mortgage 170k
Help to buy 25%

Rest equally split between me and my partner
Fix year mortgage finishes in 4 years as we had it for 10 years when purchased
It was personal purchase with no guarantees
I had very good income at that time
No other debts

sourcrates

The shortfall just becomes another non priority, non essential debt, albeit a large one.

It will just be passed to a debt collector or sold on, and someone will contact you wanting to know your intentions.

sunshine0123

Thank you for your help everyone. Is the best course of action to fill the reply form send by lawyers to say I need more time to repay this debt and present my financial situation? I have proof of all my spendings and budget done by financial advisor. 

I do worry about the risks towards my house. 

sourcrates

sunshine0123 said:

Thank you for your help everyone. Is the best course of action to fill the reply form send by lawyers to say I need more time to repay this debt and present my financial situation? I have proof of all my spendings and budget done by financial advisor. 

I do worry about the risks towards my house. 

Your home is not at risk, as I said above, the shortfall debt is just another unsecured, non essential debt that will receive non priority attention.

You can tell the solicitor that so they know that you know you are not to walked all over.

Present them with your budget if you wish, you are under no obligation to do so, the debt can be repaid at whatever amount you find affordable, they cannot contest this as affordability is the bench mark for any unsecured debt repayment, used by all agencies including the courts.

ManyWays

sourcrates said:

sunshine0123 said:

I do worry about the risks towards my house. 

Your home is not at risk, as I said above, the shortfall debt is just another unsecured, non essential debt that will receive non priority attention.

Are you saying this from the experience of how BMW Financial Services proceed with a very large debt? Because 35k is large enough to receive individual attention from a lender. A CCJ and a charge on the house (or a restriction as it is jointly owned) is possible.

It is unlikely but I would also check the finance agreement or default notice that will have been sent to see if there is a reference to interest being charged after a CCJ has been obtained. This is not normal but I have no experience of PCP on very expensive cars.