Vehicle hand back after half of finance paid?

[Whitty6]

Hi,

I have heard off a friend recently that it is possible to just hand back your car to the dealer after more than half of the finance has been paid on the vehicle.
Is this true and if so are there any implications to this?
I have had an Audi from brand new for 3 years and have paid more than half of the finance but still approx £30k outstanding on the balance?
Does it matter what mileage has been done?

Much appreciate any help.

Regards

[andburg]

Depends on the type of finance, exact detaisl would be in your paperwork however I believe it only applieds to Hire-Puchase agreements not a loan.

[Lee540]

Call your finance company and they will tell you.

[Snollygoster]

If the balance was £60k, and you have paid £30k, then yes you can hand the car back under what they call the "halves rule" (assuming this was sold on a finance product where this exists - check the T&C's of your contract)

It should state clearly in your contract the amount, and so long as it's in good working order, contact Audi/Volkswagen Finance and exercise you're right. It should read something like:

TERMINATION: YOUR RIGHTS. You have a right to end this agreement. To do so, you should write to the person you make your payments

to. They will then be entitled to the return of the goods and to half the total amount payable under this agreement, that is £7,271.06 (seven

thousand two hundred and seventy one pounds and six pence). If you have already paid at least this amount plus any overdue instalments, and

have taken reasonable care of the goods, you will not have to pay any more.

[rfoster]

Under a regulated finance agreement - conditional sale (hire purchase, lease purchase, PCP) then yes, once you have paid 50% of the TOTAL amount payable under the finance agreement (i.e. deposit, payments, balloon payment and any document fees) then you can terminate the vehicle and hand it back to the finance company without any further obligation, as long as you have kept the vehicle in roadworthy condition with up to date service history as per the manufacturer schedules and you haven't covered more mileage than you advised on a pro-rata basis (only really applies to a PCP product).

You will be charged for bald tyres, missing services, any damage to the vehicle.

Whilst it is your right to terminate the agreement, without it affecting your credit score, it's worth noting that your credit report will show that you have voluntarily terminated a finance agreement, and this may or may not have an effect on a different car finance company offering you a future facility. If you're looking to change you car now, I'd suggest first requesting a settlement figure from the lender and seeing whether you can sell the vehicle for more than this amount, which will leave you with some equity.

[HTP99]

On HP or a PCP you can VT (voluntary terminate) a car if at least half of the total amount payable at the end of the agreement as been paid,, so if there is interest on the agreement this has to be taken into account to.