cars on finance but want to change car using the same finace
Discussion
Right then, i purchased a corsa 2 years ago on finance. i have now paid off half the finance and have the option to hand the car back.
But i want to keep the finance i'm currently on and get another car of same value.
So is it posible to go to the same dealership and hand my car back and they give me another and carry on the finance? or am i in dream land..... i'm sure i've seen something on here about it before i just can't find it.
But i want to keep the finance i'm currently on and get another car of same value.
So is it posible to go to the same dealership and hand my car back and they give me another and carry on the finance? or am i in dream land..... i'm sure i've seen something on here about it before i just can't find it.
Efbe said:
how much you paying on it? how long left, an how much are you looking at a car for?
also finance is often not the best way to go with these things
original car was 13k as is the one i've seen.also finance is often not the best way to go with these things
i've paid off 2 years and have 2 years left to pay.
i know finance isn't the best way but i needed a car so instead of buying something i didn't really want, i have a bit of disposable income which covers what i pay and happy to continue
no one else is replying, so i'll just add that I think the thing you are looking for is the "rule of halves and thirds"
I don't know it very well, but it something to do with being able to hand a car back, ending the contract there and then, so you owe no money and are owned no money. Don't know if this suits your situation though. If it did, you could do this, then just start again.
IMO finance is a horrible thing. ties you into a car that will most likely depreciate far faster than you able to pay it off. But then its why I've never owned expensive cars, and why I never will until I can afford them in cash, or some other means that isn't finance!
Problem is also that as soon as you say, ok lets do finance, people tend to shove their budget well up, and end up paying much much more than they should be.
On a totally different note. If you hand a car back to a dealer, they will value it at the trade-in value. given how badly its been going for dealers recently, they will offer absolute peanuts. Whatever you read as the trade in value of your car on whatcar or wherever, take off 10%, and they will likely offer that max!
Selling it privately always works out better (well nearly always)
edit: rule explained here:
http://www.askpedia.com/q/837C/HALF_AND_THIRDS_RUL...
I don't know it very well, but it something to do with being able to hand a car back, ending the contract there and then, so you owe no money and are owned no money. Don't know if this suits your situation though. If it did, you could do this, then just start again.
IMO finance is a horrible thing. ties you into a car that will most likely depreciate far faster than you able to pay it off. But then its why I've never owned expensive cars, and why I never will until I can afford them in cash, or some other means that isn't finance!
Problem is also that as soon as you say, ok lets do finance, people tend to shove their budget well up, and end up paying much much more than they should be.
On a totally different note. If you hand a car back to a dealer, they will value it at the trade-in value. given how badly its been going for dealers recently, they will offer absolute peanuts. Whatever you read as the trade in value of your car on whatcar or wherever, take off 10%, and they will likely offer that max!
Selling it privately always works out better (well nearly always)
edit: rule explained here:
http://www.askpedia.com/q/837C/HALF_AND_THIRDS_RUL...
Edited by Efbe on Sunday 9th January 01:13
Is the car worth what you owe on it?
One would assume that the car is on standard Hire Purchase, Choices doesn't go over more than 3 years so you wont have a big final payment.
Go to your dealer, (if you trust them) and say to them, Ill change, but only if the payment stays the same, or if you dont mind spending a little more give them the budget. Specify that you want the same term or less.
Try to pick a car you have in stock. Vauxhall are paying the VAT on new cars atm, but if it takes more than 2.5 months to deliver, you will end up paying more.
If they cant do what you want, dont be afraid to walk away. you have a car which fits the bill, is still under warranty and doesn't need MOT'ing for another year.
One would assume that the car is on standard Hire Purchase, Choices doesn't go over more than 3 years so you wont have a big final payment.
Go to your dealer, (if you trust them) and say to them, Ill change, but only if the payment stays the same, or if you dont mind spending a little more give them the budget. Specify that you want the same term or less.
Try to pick a car you have in stock. Vauxhall are paying the VAT on new cars atm, but if it takes more than 2.5 months to deliver, you will end up paying more.
If they cant do what you want, dont be afraid to walk away. you have a car which fits the bill, is still under warranty and doesn't need MOT'ing for another year.
richcorsavxr said:
thankyou for that,
i've justed googled 'rule of halves and thirds' and its come up with some intresting reading from the money saving expert site which has the answers i'm looking for.
i belive the finance company take the car as long as its in good condition, which thankfully it is
Careful with this though. The car has to be in VERY good condition. I also saw a note on one forum saying shouldn't ever sign a type of form when doing it. Bugger knows what form it was, but also saw it on the same forum you were on.i've justed googled 'rule of halves and thirds' and its come up with some intresting reading from the money saving expert site which has the answers i'm looking for.
i belive the finance company take the car as long as its in good condition, which thankfully it is
Rather than going in to pluses and negatives of finance I'll stick to the factrs for you.
If the agreement is on the car then you cannot simply continue the agreement on another car, the finance and car are linked.
If it was a personal loan, ie the car is not on the documents then there is no problem with continuing with the agreement as it is not secured against the car
If you have paid back more than half the total amount payable (not borrowed) then you can hand it back to the finance company, simplky contact them and they will try very hard to settle with a lower settlement figure than would normally be the case if the Rule of 78's was applied - its up to you if you want to go down that route, certainly worth considering if the car is worth more than the settlement figure offered.
If you do exercise your right to return the car insist that they collect from your home address, they will inspect the car, generally using a BVRLA document that is a totally reasonable set of parameters to assess condition, it accepts that there will be fair wear and tear.
Exercising your rights to Voluntary Termination has no impact on your credit rating, you are merely exercising your legal right
If the agreement is on the car then you cannot simply continue the agreement on another car, the finance and car are linked.
If it was a personal loan, ie the car is not on the documents then there is no problem with continuing with the agreement as it is not secured against the car
If you have paid back more than half the total amount payable (not borrowed) then you can hand it back to the finance company, simplky contact them and they will try very hard to settle with a lower settlement figure than would normally be the case if the Rule of 78's was applied - its up to you if you want to go down that route, certainly worth considering if the car is worth more than the settlement figure offered.
If you do exercise your right to return the car insist that they collect from your home address, they will inspect the car, generally using a BVRLA document that is a totally reasonable set of parameters to assess condition, it accepts that there will be fair wear and tear.
Exercising your rights to Voluntary Termination has no impact on your credit rating, you are merely exercising your legal right
Edited by andy665 on Sunday 9th January 14:45
Go to the dealer in question and ask him to giv you trade in value for your current car. In parallel get a settlement figure from your finance comapny. Hopefully the former is higher than the latter. Trade car in against new car, dealer will pay off outstanding finance and what's left over can be used towards the new car which you can have a new finance agrement with.
The fundamental key to the above is that the trade in value is higher than the settlement figure on the financed and what's left over is enough for a deposit on the new finance.
Don't quote me on this but I'm pretty sure if you hand back a car on HP after 50% it goes on your credit record.
The fundamental key to the above is that the trade in value is higher than the settlement figure on the financed and what's left over is enough for a deposit on the new finance.
Don't quote me on this but I'm pretty sure if you hand back a car on HP after 50% it goes on your credit record.
Efbe said:
On a totally different note. If you hand a car back to a dealer, they will value it at the trade-in value. given how badly its been going for dealers recently, they will offer absolute peanuts. Whatever you read as the trade in value of your car on whatcar or wherever, take off 10%, and they will likely offer that max!
Selling it privately always works out better (well nearly always)
Not so. Used car values have risen significantly in January as demand has increased but supply remains short. This is as a result of poor new car performances reducing the number of trade ins and decreased production by the manufacturers.Selling it privately always works out better (well nearly always)
andy665 said:
Exercising your rights to Voluntary Termination has no impact on your credit rating, you are merely exercising your legal right
True, but be aware that a note IS added to your credit file explaing that you have voluntarily terminated the agreement. This can make some HP lenders less likely to consider you. If you, or anyone, is considering taking advantage of the termination rights you should ALWAYS ensure your finance proposal has been accepted on the new car BEFORE concluding the termination of the old one.Efbe said:
IMO finance is a horrible thing. ties you into a car that will most likely depreciate far faster than you able to pay it off.
That clearly depends on the car and the finance arrangement but is certainly not 'most likely'.Efbe said:
But then its why I've never owned expensive cars, and why I never will until I can afford them in cash, or some other means that isn't finance!
So what is the alternative if it is not cash or finance? Theft?Efbe said:
Problem is also that as soon as you say, ok lets do finance, people tend to shove their budget well up, and end up paying much much more than they should be.
In those cases, it is not the finance arrangement that is the problem, it is the borrower!!
Sidicks
sidicks said:
Efbe said:
IMO finance is a horrible thing. ties you into a car that will most likely depreciate far faster than you able to pay it off.
That clearly depends on the car and the finance arrangement but is certainly not 'most likely'.Efbe said:
But then its why I've never owned expensive cars, and why I never will until I can afford them in cash, or some other means that isn't finance!
So what is the alternative if it is not cash or finance? Theft?Efbe said:
Problem is also that as soon as you say, ok lets do finance, people tend to shove their budget well up, and end up paying much much more than they should be.
In those cases, it is not the finance arrangement that is the problem, it is the borrower!!Sidicks
1) it does depends on the car, and i don't know what the car is. but a car for 13k is damn likely to depreciate like a rock.
2) loan, overdraft, through work.
3) agreed, but people do get very carried away as soon as they have the access to the money. I know many many people who have bought a car on finance without really looking into it, or particularly thinking about it, just because at tat point, the monthly repayments doesn't seem so bad. 3 years later, and the realisation of how much they have shelled out for something that is now 3 years older, most likely 3 years old.
I think easily obtained money does encourage rash decisions.
Efbe said:
1) it does depends on the car, and i don't know what the car is. but a car for 13k is damn likely to depreciate like a rock.
Surely higher value cars tend to depreciate more than lower value ones??!!!Efbe said:
2) loan, overdraft, through work.
That's still finance!!Efbe said:
3) agreed, but people do get very carried away as soon as they have the access to the money. I know many many people who have bought a car on finance without really looking into it, or particularly thinking about it, just because at tat point, the monthly repayments doesn't seem so bad. 3 years later, and the realisation of how much they have shelled out for something that is now 3 years older, most likely 3 years old.
I think easily obtained money does encourage rash decisions.
Nothing wrong with the right finance package provided it is strucured sensiblyI think easily obtained money does encourage rash decisions.
Sidicks
PH. The world where everyone has cash to buy a reliable long term car and nobody ever needs to finance it...
OP. You may end up changing finance companies. Obviously it's your legal right to hand back the car, but they don't like it and I suspect may prefer to lend their money elsewhere next time.
I'm not sure about applying BVLRA guidelines to condition either. As I understand it the legislation stats that the car has to be in 'reasonable' condition. Anyone attempting to put guidelines on that are merely trying to be awkward.
I handed a car back years ago after it was in neg equity and a company car came along. Pretty sure that it went on my record as Termination (Other). Mortgage company did ask for an explanation when I applied a few months later, but were quite satisfied.
OP. You may end up changing finance companies. Obviously it's your legal right to hand back the car, but they don't like it and I suspect may prefer to lend their money elsewhere next time.
I'm not sure about applying BVLRA guidelines to condition either. As I understand it the legislation stats that the car has to be in 'reasonable' condition. Anyone attempting to put guidelines on that are merely trying to be awkward.
I handed a car back years ago after it was in neg equity and a company car came along. Pretty sure that it went on my record as Termination (Other). Mortgage company did ask for an explanation when I applied a few months later, but were quite satisfied.
mcflurry said:
davidjpowell said:
PH. The world where everyone has cash to buy a reliable long term car and nobody ever needs to finance it...
I was thinking the same I know I do (having put myself seriously in the s
t from buying cars on finance in the past!)Petrolhead_Rich said:
mcflurry said:
davidjpowell said:
PH. The world where everyone has cash to buy a reliable long term car and nobody ever needs to finance it...
I was thinking the same I know I do (having put myself seriously in the s
t from buying cars on finance in the past!)I find nothing wrong in my latest <£1000 venture.
also when people talk of finance, they usually refer to taking it out with the dealership. The other means enable you to have much more control over your money. sometimes they work out better, other times not.
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