Finance - What happens if you want to exit, very very early!
Discussion
Chaps,
Car finance....with a balloon type arrangement, generally, what happens (i.e. how much??) if you wish to exit very early in the term?
Example:
36 month term, exit after 6 months!
I know that you're charged a 30 day interest penalty, but what would happen if you'd paid a large deposit, 25% for the sake of this example?
Is the car re-valued at the time of exit (at trade value) with a view to calculating a settlement?
I'd guess that the interest on the advances and balloons is also front loaded?
ta!
Car finance....with a balloon type arrangement, generally, what happens (i.e. how much??) if you wish to exit very early in the term?
Example:
36 month term, exit after 6 months!
I know that you're charged a 30 day interest penalty, but what would happen if you'd paid a large deposit, 25% for the sake of this example?
Is the car re-valued at the time of exit (at trade value) with a view to calculating a settlement?
I'd guess that the interest on the advances and balloons is also front loaded?
ta!
Depends entirely on the detail of the contract you signed.
Unsurprisingly the lease companies protect themselves in the contract.
Many hundreds of pounds penalty possibly thousands.
There is the limiting factor that the lease company may be required to prove their loss in litigation but frankly, no judge would be very sympathetic.
This is an adult business contract between consenting adults.
Expensive. Rightly so.
Unsurprisingly the lease companies protect themselves in the contract.
Many hundreds of pounds penalty possibly thousands.
There is the limiting factor that the lease company may be required to prove their loss in litigation but frankly, no judge would be very sympathetic.
This is an adult business contract between consenting adults.
Expensive. Rightly so.
Yup, been there before 
All depends on the value of the car when you sell. Your deposit will most likely of been eaten. I cringe at the thought of low-deposit (10% for example) deals - simply because, i change my cars tooooo often.
Simply put though, you just phone your finance company, ask them what your balance to settle is, and then try and get the best deal for your car from either trade, or sell private, with you or the purchaser settling the finance before exchange
All depends on the value of the car when you sell. Your deposit will most likely of been eaten. I cringe at the thought of low-deposit (10% for example) deals - simply because, i change my cars tooooo often.
Simply put though, you just phone your finance company, ask them what your balance to settle is, and then try and get the best deal for your car from either trade, or sell private, with you or the purchaser settling the finance before exchange
T2R31 said:
Righty o'....
Is the interest heavily front loaded too....?
Erm...Is the interest heavily front loaded too....?
Interest is a bigger proportion of your payment at the start of the term because you owe more money. As you pay off the loan you owe less so the interest is less.
The finance company don't care what the value of the car is, they want their money.
As above - ring up for a settlement figure. If you sell the car for less than the settlement you'll have to add some cash.
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