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Pressured into getting car i dont want it

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24

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  • Goudy
    Goudy Posts: 2,144 Forumite
    Sixth Anniversary 1,000 Posts Name Dropper
    edited 16 July at 2:17PM
    Goudy said:

    Cars don't depreciate evenly. The first few years are the heaviest, then they start to lose less and less each year.
    The car is worth £8k. That would likely put it around 7yrs old, and the OP only got it ten months ago.

    50 payments to go, £250/mo = £12,500 - so that outstanding figure includes five years of interest that wouldn't need to be paid. The settlement will be FAR less.

    From those figures, I suspect it was overpriced to start with, and a high interest rate, thanks to one of these "sub-prime" retailers and financiers? So they won't bend over backwards to help...
    To get off cleanly, the settlement and achievable value have to match. 

    If the achievable value is more, then you can put that towards the next car.
    If it's less, then it's negative equity and it'll need paying/refinancing.

    Somehow, I think that the OP would be far from that only 10 months in, even factoring in the interest saving of the settlement figure.

    But there is only one way to find out.
    Get a settlement figure and an evaluation of the car.

    As it's a used car depreciation should have eased off a little but there would have been around 20%, give or take of dealer profit in the car when it was bought.

    So yes, it would have been overpriced compared to a trade in price. They effectively bought retail and now want to move it on as a trade in.

    If I had to guess now, I'd hazard a guess there's something around 20% more owed on the settlement figure than the current value but some of that could be taken up with hawking it around dealers trying to get a better trade in price, but you'd probably need to buy a much more expensive car on another high interest finance package so the dealer can make the healthy trade in back.
  • Hoenir
    Hoenir Posts: 7,742 Forumite
    1,000 Posts First Anniversary Name Dropper
    It's a mode of transport. I've had many cars over the years I had no affection for. Taking a financial hit unneccessarily isn't worth it.  
  • Herzlos
    Herzlos Posts: 15,870 Forumite
    Part of the Furniture 10,000 Posts Photogenic Name Dropper
    iHush said:
    DE_612183 said:
    What is the balance on the finance and what is the value of the car - why not part-ex it for something else?


    There is still 13k and the cars now probably worth 8k. Its HP cant Part Ex a car on finance can you?

    You can part ex it no problem, but if it's in negative equity (you owe more than the p/x value) you need to either find that money or roll it into the new car. 

    So there's nothing stopping you changing it for a car you like, though it may cost you a bit. 
  • Goudy
    Goudy Posts: 2,144 Forumite
    Sixth Anniversary 1,000 Posts Name Dropper
    edited 17 July at 11:02AM
    Why don’t you want the car ?
    Why don’t you like the car ?

    which is more important to you; money or your dislike of the vehicle ?

    personally, I would just grit my teeth and spend the next 4 years saving up and looking forward to getting something I do want as opposed to going a few k in the red
    It probably won't take another four years before the amount owed equals the cars value.
    Saving up might not be the best solution either*.

    To get off cleanly, the OP only needs to keep paying until the settlement equals what the cars value is at that time.

    There is a point when the depreciation tails off enough that the car loses less than the repayments already made and the car is no longer in negative equity (or in equity).

    If they carried on paying for another 50 months, the car will be paid off and there will have some value or equity in it.
    By then that would be fairly small due to age/condition/mileage but it would still have some value.

    What the OP needs to do is find the point where their car and what they owe matches. ie no negative or positive equity.

    It's hard to say when this will be, but I think it would be nearer the 50% mark of the contract or around 2.5 years in.
    So in another year and a half (ish), that's when I'd check again with another settlement figure and car valuation.

    *You could bring this equalisation forward by over paying either each month or in chunks when you have it.
    The interest on the finance will be far far higher than you could possible get by stashing your cash in a savings account and your over payments obviously go towards capital AND interest on the finance and that will bring the settlement vs valuation forward.

  • droopsnoot
    droopsnoot Posts: 1,868 Forumite
    Part of the Furniture 1,000 Posts Name Dropper
    Why don’t you want the car ?
    Why don’t you like the car ?

    which is more important to you; money or your dislike of the vehicle ?

    personally, I would just grit my teeth and spend the next 4 years saving up and looking forward to getting something I do want as opposed to going a few k in the red
    Perhaps the fact that it was the ex's choice of car makes this more difficult, a constant nagging reminder of the past. The OP just has to decide whether the money they'll almost certainly lose in getting rid of it is worth it. 
  • Goudy
    Goudy Posts: 2,144 Forumite
    Sixth Anniversary 1,000 Posts Name Dropper
    edited 17 July at 11:23AM
    Why don’t you want the car ?
    Why don’t you like the car ?

    which is more important to you; money or your dislike of the vehicle ?

    personally, I would just grit my teeth and spend the next 4 years saving up and looking forward to getting something I do want as opposed to going a few k in the red
    Perhaps the fact that it was the ex's choice of car makes this more difficult, a constant nagging reminder of the past. The OP just has to decide whether the money they'll almost certainly lose in getting rid of it is worth it. 
    Do you think taking a big financial hit on it just to get rid might be more of a nagging reminder of the past?

    But saying that, I think the fact it's a Grandad X is enough reason.
  • Herzlos
    Herzlos Posts: 15,870 Forumite
    Part of the Furniture 10,000 Posts Photogenic Name Dropper
    Lifes too short to be driving a car that makes you miserable. 
  • Goudy
    Goudy Posts: 2,144 Forumite
    Sixth Anniversary 1,000 Posts Name Dropper
    Herzlos said:
    Lifes too short to be driving a car that makes you miserable. 
    And life's too long to throw good money down the drain just to get out of a perfectly usable car that you already owe thousands more than it's currently worth.

    Things can get out of hand quickly if you roll the finance into the next car finance package.
    We already see a lot of posters coming on here with car issues and finance problems that they owe far more than the car is worth, like the OP does already.

    The risk of dragging thousands more negative equity into another finance deal is going to be costly.
    If anything happens to the car the insurance will only pay out market value, leaving you with a big black hole to fill with the finance company and only sub prime leaders will allow you to roll that much forward. So the interest is going to be high.
    This will force you to look at older cars with much lower purchase prices to meet your monthly payment affordability.

    Just wait until the cars value equals the settlement figure and then get rid.


  • sheslookinhot
    sheslookinhot Posts: 2,255 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    Herzlos said:
    Lifes too short to be driving a car that makes you miserable. 
    How can a car make you miserable ? It’s only a tin box with some rubber at each corner, whose objective is getting you from A to B.
    Mortgage free
    Vocational freedom has arrived
  • Bigphil1474
    Bigphil1474 Posts: 3,546 Forumite
    Part of the Furniture 1,000 Posts Photogenic Name Dropper
    You've not driven a Rover then?
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