Car Finance

[mishmoneypen]

In May 2004 I bought a Peugeot 205 on credit through a major dealer.  I now no longer need this car as I have a company car and Im not sure what the procedure is for selling the car and paying the credit company back.  Can I hand it back to the dealer or do I sell it privately and then the money I sell it for I give to the credit company, will they charge me a penalty of any sort?  Ive got the credit over three years

[Mrs_Pegasus]

Dig out the HP documents.  It will tell you on there the penalties and I think you will find there will be some because you hoping to settle before 2 years have passed which I have always found to be the crunch time.  Many HP agreements are front loaded with interest so for X amount of months you are simply paying off the interest so i think you will be quite shocked at how much will still be owing.

It is illegal to sell a vehicle with HP on and thats why many people use a HPI check before buying a vehicle privately.

Personally I would contact the dealership and enquire whether they would be interested in 'buying' the car back because they can deal directly with the HP company.

In theory if you did have someone interested they could liase with the company directly and purchase the car off them i.e. pay off your outstanding debt.

It is a tough time to sell a 2nd hand car at this time of year because the market is flooded due to the new registrations coming out in a couple of weeks time.

Good Luck

[Oneeyedvic]

All above is true unless you purchased the car on a loan agreement as opposed to a Hire Purchase agreement. Black Horse finance for example only do loans. If it is a loan, then you can sell the car without bothering to inform the finance company.

 

If it is a HP agreement, then there is the 1/2s rule. Have a look at your agreement, and there will be a figure which when you have paid it (1/2 the total amount of credit), you can simply hand the vehicle back. After 1 year, it is unlikely that you would have reached the figure unless you had a big deposit.

 

Hope this helps

[kellymunson]

I am in a simillar situation but I only purchased my car 3 months ago and as my circumstances have changed I cannot meet the repayments. I am with Blackhorse but they say it's a hire purchase agreement not a loan. What are my options in this situation? Please Help.