Car crash

[ray bush]

My son has a car which i've been buying for him in my name on one of these 3 year deals with a lump sum payment at the end of the term.
Earlier this week a white van man wrote it off (which was his fault) .
The car is insured in my sons name and is fully comp .
How would this work re compensation for car etc .

Regards

[bednobs]

What do you mean compensation? The insurance will give you the market value of the car (unless you also have GAP insurance)

[ray bush]

Probably use the wrong word.I meant the overall claim etc,he's still waiting for his insurance company to contact him re hired car etc.
Would he be able to buy the car back if its a write-off ?i can never be sure how they work out its worth after an accident .
Regards

[Graham-W]

Depends a lot on the terms of the deal. Is it classed as a lease car for the first three years, with an option to buy at the end? If this is the case the supplier may have to replace the car and they will have to sort out the insurance payments.
Read the small print in the agreement.

[ray bush]

Nothing in small print regarding accidents .

Regards

[bednobs]

ps, the credit agreement will still require you to pay

[chas2008]

unlikey he will be able to buy it back or even not worth buying back,im assuming this is a fairly late vehicle being on one of these deals,if so to be written of it must be quite substantial damage.
As said unless you have GAP insurance you will only ever get the current market value i would expect one way or the other you would have to make up any shortall yourself.
Are there the 3 options ?
Give it back a the end of the deal, pay the guaranteed value(lump sum) or re-finance?

[ray bush]

Its a 2009 Mazda 2 and the 3 options at the end were as you have stated.

Regards

[chas2008]

really need to find out what amount the insurance company is going to settle the claim with.
One way or the other the dealer will want the vehicle back in a good saleable condition (which isnt going to happen) or the lump sum paying off.

[ray bush]

The thing with this is that my son has already paid-off over two thirds of the price of the car (£7800) ,which is now coming to the end of its term.I was thinking of buying the car at the end of the term for the balance .
The repairs to my sons car are down to the other driver's insurance to deal with and for them to sort-out some type of compensation with my sons insurance company.

[chas2008]

with these deals you never recover whats already been paid, as the vehicle devalues, its a form of personal lease hire.
These deals are mainly aimed at people who finance a new car every 2-3 years or cant afford to finance it outright or afford a large deposit.
A majority of people hand it back at the end or go into another vehicle on the same type of deal.
This is where low mileage used cars come from as the usually have mileage limitations on them (6,000-10,000 per annum)..

[ray bush]

Thanks for the reply .
What i was trying to get clear in my own mind was that Whilst my son had paid say £7500 with a say£3500 lump sum to pay at the end of the term,that is when the insurance people have done their bit and got the money back from the other parties insurers for the market value of the car..........what would happen then .I may have been able to spend my time putting the car back together again ,that is if we had an option to buy it at a lower market value .Also the fact that the finance company could get quite a bit back from the settlement which would cover any shortfalls.