Voluntary Termination on PCP car agreement

In short... or not....

50% relates to the agreement value (so if you have a £20k finance agreement, you need to owe less than £10k).

Generally if you Volutarily Terminat (VT) your vehicle, it does not affect your credit rating as it is a consumer right, however I believe that when they mark your finance as 'settled' on your credit file, they are able to put a note on it stating that you VT'd the vehicle. This will not affect you for most things, but if you are refinancing a new vehicle, other finance companies may be wary of you (This stays on your credit record for a number of years, and vehicle finance people see people like me do a PH (no limited mileage like a PCP) put an extreme amount of mileage on the car, and handback a worthless vehicle whilst still owing 50%, this can mean they actually loose money! This does not affect you for personal loans or mortgages because these clauses are not available on these financial products.

Lastly, as you said, the vehicle is worth less than the finance. I recommend you phone BMW finance to ask them about your options, you may be able to VT at 2 years, but that depends on your PCP APR and the final Guaranteed minimum future value. If the car was £20 with no deposit, and the GMFV of the car is £10, you wil never be able to VT it, likewise, high APR figures with high monthly repayments mean it is harder still to get to that magical 50%. BMW will be able to advise you if you are able to VT the car. Lastly, BMW may be willing to just take the car back. I experienced this with a BMW finance manager trying to sell me a 1 series a few years ago, they seemed to think that after 2 years on a 5 year PCH BMW would still take the vehicle back. I could not understand why, he just assured me they would. He can not lie to me, as he is covered by the FSA as a financial advisor, and that would be mis selling a financial product, but I was weary of the validity of this and so walked away from the deal. Maybe BMW do something nice in their small print. Again, BMW should be able to advise you of your options.
Hope this helps.

kevvo wrote: »

[*]Does the '50%' I have to have paid off relate to the agreement value, or the whole car price at time I took the agreement?

My last car was a BMW on PCP and the agreement specified the actual amount of payment required to VT.

kevvo wrote: »

Thanks for all the helpful responses. I'm not quite in a position where it is urgent to end the deal, but I may contact BMW now to see what options there may be when my career change kicks in, in about 3-6 months time.

Unless anyone wants to buy a mini cooper at a grand more than market value...! ;-D

Computer says no

can anyone help we picked up a car on the 14/04/2012 signed agreement day before not happy with car can we return it without problems

11madlad11 wrote: »

I am about to call BMW to get a voluntary termination on my car. I am over the 50% payment mark which is fine.I was just wandering if anybody knows what exactly it is that the collections company checks for when they come to pick up the vehicle?????? I.e wear and tear, damage, faults etc???? And does doing at VT effect your chance of getting credit again for another vehicle in the future???

Any information on this will be greatly appreciated. Thank you.

From my experience they go over the car with a fine toothed comb ! I was waiting for the bloke to get out his magnifying glass the last time i handed a car over.(Both on PCP) He checked inside and out ! There should be details in your contract about what is deemed acceptable. My car was driven off my drive straight to the car auction ! I've done this twice in the past and luckily haven't had any comeback.