Car finance trap

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24

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  • System
    System Posts: 178,094 Community Admin
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    jonesMUFCforever wrote: »
    From going bankrupt to wanting to be free of the car finance to being able to get a bank loan (which is finance or debt) in 3 posts?
    Its called having time to think it over and discussing options....

    OP you can get a loan from your bank and repay the finance within 14 days of taking it out with no extra charge. Some people do this with new cars bought on PCP so they can take advantage of the additional discount offered with a PCP deal so they take out the PCP, get the discount, use funds or cheaper loan, repay the PCP within 14 days.
  • BoGoF
    BoGoF Posts: 7,099 Forumite
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    The problem you may have is getting a large enough loan to pay off the car. From your first post it seems you have had little in the way of credit before now?

    Generally car finance is easier to get than a loan.
  • galaxy999
    galaxy999 Posts: 7 Forumite
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    Thank you for all replies so far guys I really appreciate your help. I admit I find it all confusing as I'm not a native english speaker. Let me share some numbers

    Base price of the car was 18.000
    I handed my own old car as px and the price dropped to 15.000
    Total amount payable on the loan is 25.000

    I never had any loans in my life before but for years I always had a cellphone on contract and never missed a payment.
  • BoGoF
    BoGoF Posts: 7,099 Forumite
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    A phone contract isn't really a good indicator of credit worthiness.
  • System
    System Posts: 178,094 Community Admin
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    galaxy999 wrote: »
    Thank you for all replies so far guys I really appreciate your help. I admit I find it all confusing as I'm not a native english speaker. Let me share some numbers

    Base price of the car was 18.000
    I handed my own old car as px and the price dropped to 15.000
    Total amount payable on the loan is 25.000
    Yeah that's super expensive. The best bank loan for £15,000 over a 5 year period you would only repay £16054.
  • jonesMUFCforever
    jonesMUFCforever Posts: 28,898 Forumite
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    It will all depend on the OP's financial status.
    Is he a UK resident or merely working here?
    How long has he lived here>?
    What is his salary - what other commitments does he have - a first time loan of £15k will not be easy to get.
  • Dobbibill
    Dobbibill Posts: 4,135 Ambassador
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    consider getting GAP insurance if you are getting a car on finance.
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  • elsien
    elsien Posts: 32,761 Forumite
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    galaxy999 wrote: »
    Or maybe I should call finance company and since there's a cooling off period ask them to cancel the finance and go to my own bank for a loan that would be much easier to pay?

    Nope, you need to do it the other way round. Make sure you can get the loan first before cancelling the existing payments.
    All shall be well, and all shall be well, and all manner of things shall be well.

    Pedant alert - it's could have, not could of.
  • galaxy999
    galaxy999 Posts: 7 Forumite
    edited 23 April 2018 at 12:13PM
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    I rang the dealership and they told me I can't return the car under any circumstances so as expected.
    Also my bank can only borrow me 11.500 which is not enough to pay off the finance at once.
    Also my bank can only lend that amount for over 60 months time and I would have to give back almost 19.000

    Or bankrupcy as I don't see other options but if my annual salary is 19.000 won't I be forced to keep paying for 3 years anyway?

    Please advise this huge idiot.
  • poppasmurf_bewdley
    poppasmurf_bewdley Posts: 5,909 Forumite
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    galaxy999 wrote: »
    I rang the dealership and they told me I can't return the car under any circumstances so as expected.
    Also my bank won't borrow me the money. I really don't know what to do now.

    Well, you can tell the dealer you are going to cancel the finance and that you have no other means of financing the car. The ball is then in their court.

    Personally, that's the way I would be going. Leaving the car at their front door and the keys inside the showroom and walk away.

    The worse they can do is insist you buy the car (which you can't do), and/or keep your deposit. Was the car new or used? If new, then the value of the vehicle now will be much less than if it was used.

    They'll probably sue you for their loss. Maybe better than having a £25K debt around your neck.
    "There are not enough superlatives in the English language to describe a 'Princess Coronation' locomotive in full cry. We shall never see their like again". O S Nock
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