voluntarily terminating a credit agreement

[bednobs]

i am thinking about doing the above. The details are that i have a car on credit (where at the end you can either hand the car back or pay a balloon payment. As part of the agreement, if you have paid a certain amount of the payments, you can voluntarily terminate and hand the car back.
I rang them today to ask them how to do it (i am buying a new car from thre same garage and because it's a second hand car, it's ready now - it's the first time in 9 years of having this type of agreement that i am not swapping for another brand-new one). Anyway at the end of the call they reminded me it would be noted on my credit file that is available to other lenders that i had voluntarily terminated, and it might "go against" me for future credit. Is this true? I am not dfaulting, just taking the option that has always been there. I am especially annoyed, because i am buying a car at the same garage and finance company (mercedees), and although it's second hand i'm actually trading up, and they'll be getting more money off me!

[redcrx]

i havnt any experience here but i think that they put it on your file because the agreement is finished. This means that some companies may see it, not as a bad risk, but not as profit making for them as you have paid it off early, ie before they can make as much interest.

im sure that others will know better though

[themas]

They can only put factual information on your credit file, but in this case what they say they will do iss factual - i.e. you have terminated early. So you could not do anything to get the information removed & it would remain there for 6 years.

Whether it would go against you is entirely a matter of how other potential creditors consider it. I think only someone who is experienced in the assessments creditors make would be able to give a meaningful answer to that. I can say it would seem idiotic to me if it did go against you (except possibly if the creditor was considering giving you credit for another car with another voluntary termination clause) but that is just my layman's opinion.

What I suggest you should do - particularly as you will still be using the same finance company - is to take this up with them at a higher management level, give them all the history of the dealings you have had with them & ask them to simply note your credit file as "satisfied". If they agree, check a few weeks later that they have done that.