Issue with PCP

db_2024

Morning all, 

Cut a long story short, I signed a PCP deal on a new car back in March 2025 and picked the car up in May. 

Due to a change in circumstances and my partner not working, I am finding the monthly repayments hard to keep up with. 

What are my possible options at this stage and what financial implications will it have on me if I were to stop paying. If the account goes into default what would happen then? can they just take the car away

Ayr_Rage

The first thing to do is contact the finance firm and talk to them, don't bury your head in the sand.

If you stop paying the missed payments will be recorded on your credit file.

Eventually the finance company will repossess their car, sell it and you will be liable for any shortfall between the auction price and the amount of outstanding finance plus fees.

If you cannot pay that sum they may well take legal action to recover what you owe.

If you really cannot afford it now then handing it back and finding a way of paying the current shortfall is probably preferable to trashing your credit by missing payments and defaulting.

Nasqueron

Ayr_Rage said:

The first thing to do is contact the finance firm and talk to them, don't bury your head in the sand.

If you stop paying the missed payments will be recorded on your credit file.

Eventually the finance company will repossess their car, sell it and you will be liable for any shortfall between the auction price and the amount of outstanding finance plus fees.

If you cannot pay that sum they may well take legal action to recover what you owe.

If you really cannot afford it now then handing it back and finding a way of paying the current shortfall is probably preferable to trashing your credit by missing payments and defaulting.

And to emphasise this - it will be a car auction so unlikely to reach any sort of premium price as the buyers want to maximise profit by paying the least they can.

If it's new, anything like WBAC will be a lot under the value new but might give you an idea what shortfall you will have to cover

Otherwise you could VT it after 50% of the total payment (including interest and balloon) but that would be a couple of years, it wouldn't kill your credit though

db_2024

I should never have bought this car. 

MEM62

db_2024 said:

Due to a change in circumstances and my partner not working, I am finding the monthly repayments hard to keep up with. 

Is your partner not working part of the charge in circumstances? If so, how long do you estimate it will take for them to secure new employment?  What else changed?

db_2024 said:

What are my possible options at this stage and what financial implications will it have on me if I were to stop paying. If the account goes into default what would happen then? can they just take the car away

If you have an emergency fund you can dip into that to tide you over until you circumstances become more favorable.  (If you don't then I am sure that you now see the benefit of building one once your financial circumstances are back on a even keel)

Other than that you can stop paying and hand the car back.  As already mentioned there is likely to be considerable negative equity that you will need to cover so this is unlikely to reduce your outgoings in the short-term. Falling behind on your payments will leave negative markers on your credit history.