New Member - Advice please

[confusedson]

Hi Everybody - Long time lurker here and spent many an hour here but finally got the courage to join my first ever internet forum.
I'll do my best to please the spelling & grammar police on here but please feel free to correct the error of my ways.

Well anyway, I like to ask for some advice.
Long story short, my parents divorced a couple of years ago. Mother got a decent pay-off with house & cash etc but has managed to spend everything she had. She bought a car in June 2011 on HP but has not been able to make payments for last few months and the car was nearly repossessed.

I've made the payments for her for past few months but I'm unable to continue long term.
She's finally come round to the fact that she cannot afford to keep the car but I'm wondering what her options are.

1. Can she hand the car back to the finance company and walk away?
2. If the car is repossessed, will she be due any outstanding finance?
3. Will any dealer buy it for a decent price?

Additional info.
Car is a Renault 2011 Modus Diesel. 11,000miles
Finance was taken over 5 years at 199 per month.

Thanks

[davepoth]

Can't help much with the legalities of the situation but your spelling and grammar seem acceptable. You'll fit in fine.

The terms and conditions vary on these things quite a lot, so it's worth checking into them. Generally if you have paid off more than half of the HP agreement you can hand the car back without penalty, but if not there is often a fee to pay.

[confusedson]

Thanks for the reply.
I'm phoning the finance company tomorrow morning so any advice is appreciated.
I'll see if I can dig out the paperwork tomorrow before I call.

When she got the letter about the car getting repossessed a couple of months ago they mentioned a fee of 300 pound for repossession but no mention of any other fees.

I'll update tomorrow after speaking to the finance company.

[John Boy 616]

It is hire purchase, so if she cant make payments she can hand them car back, im sure penalties and a tarnished credit score are likely, however it is their car and they own it until final payment is made

[Kong]

From those figures I'd say the car will be worth more than the settlement figure, just. I would take out a bank loan, clear the finance which will in turn make the car much easier to sell privately (i.e for a lot more money than you would get trade-in) then pay off loan straight away with minimal interest.

[Hitch78]

How can you work that out?

I think there's a rule that after you reach half way you can hand the keys back - she might not be there yet but if it is just two or three months it might be worth keeping it until that point to avoid credit score pain.

Credit score pain is a real pain.

[E31Shrew]

Ask the bods on the Car Salesmans thread, as I'm sure you're not the first!

[SuperVM]

Hitch78 said:

How can you work that out?

I think there's a rule that after you reach half way you can hand the keys back - she might not be there yet but if it is just two or three months it might be worth keeping it until that point to avoid credit score pain.

Credit score pain is a real pain.

Indeed. A friend of mine accepted a settlement on his credit card about three years ago, by which I mean he agreed to pay about 50% of the balance and close the account. He still can't get mobile phones on contract.

[2manycars]

You've done a really nice thing for your mother there, so give yourself a pat on the back.

Obviously i don't know your mothers situation, i.e. How old she is, health, commitments and such.

Is there no way she could get a part time job at nights in the pub, cleaning or serving. This should cover the £200 per month, save a bad credit score, plus she'll get too meet new people.

I'm not preaching so please don't take offence, it's just that sometimes people overlook the obvious.

Hope everything works out for you both.

Pete

[confusedson]

Kong said:

From those figures I'd say the car will be worth more than the settlement figure, just. I would take out a bank loan, clear the finance which will in turn make the car much easier to sell privately (i.e for a lot more money than you would get trade-in) then pay off loan straight away with minimal interest.

Bank loan isn't an option I'm afraid.
Spoke with finance company today and the settlement figure is £6800. Doubt the car is even worth that selling privately.

[alistair1234]

Voluntary Termination is what you can do when you have paid back at least 50% of the balance. But the HP has to be up to date, so any outstanding payment would need to be paid first.

If it is repossesed they will sell at auction for pennies and the remaining balance (not early settlement fig), will be pursued by bailifs.

So if you can't VT, sell privately and then you will only have to pay off the early settlement fig.

I used to work for Capital Bank.

[confusedson]

2manycars said:

You've done a really nice thing for your mother there, so give yourself a pat on the back.

Obviously i don't know your mothers situation, i.e. How old she is, health, commitments and such.

Is there no way she could get a part time job at nights in the pub, cleaning or serving. This should cover the £200 per month, save a bad credit score, plus she'll get too meet new people.

I'm not preaching so please don't take offence, it's just that sometimes people overlook the obvious.

Hope everything works out for you both.

Pete

Thanks Pete. No offence taken. We've been trying to get her to get a wee part time job but she's not looking into it seriously. She's had my Dad supporting her for the past 40 years with her having the odd part time job here and there for something to do.

She's been burying her head in the sand for a while but thinks this will all just blow over and as long as I'm paying for the car it she just carry on as if nothing has happened.

It may sound harsh but maybe losing the car will be a wake up call for her.

[confusedson]

alistair1234 said:

Voluntary Termination is what you can do when you have paid back at least 50% of the balance. But the HP has to be up to date, so any outstanding payment would need to be paid first.

If it is repossesed they will sell at auction for pennies and the remaining balance (not early settlement fig), will be pursued by bailifs.

So if you can't VT, sell privately and then you will only have to pay off the early settlement fig.

I used to work for Capital Bank.

After speaking to the finance company this morning we're looking into the voluntary termination route. Problem is she still has 9 more payments to make before we're halfway through the term.

If the finance company accept the VT, would we still be due the equivalent of the 9 payments?

[Benny Saltstein]

confusedson said:

Thanks Pete. No offence taken. We've been trying to get her to get a wee part time job but she's not looking into it seriously. She's had my Dad supporting her for the past 40 years with her having the odd part time job here and there for something to do.

She's been burying her head in the sand for a while but thinks this will all just blow over and as long as I'm paying for the car it she just carry on as if nothing has happened.

It may sound harsh but maybe losing the car will be a wake up call for her.

Having been in a similar situation to yourself, sometimes you have to be cruel to be kind.

[alistair1234]

confusedson said:

After speaking to the finance company this morning we're looking into the voluntary termination route. Problem is she still has 9 more payments to make before we're halfway through the term.

If the finance company accept the VT, would we still be due the equivalent of the 9 payments?

I think you would have to pay the 9 payments first to put the account in 50%+ paid, then write in to request VT.

Or thats how it was done at Capital Bank, they wont take the car then invoice for the remaining. You will have to pay first.

[Gruber]

OP - have you tried taking the car to a couple of dealers to see what they'd pay for it?

Or is there a kindly trader on here who can give a book value?

Worth exploring that route. Might be a cheaper way out than handing it back.

[vrsmxtb]

Might be a blessing in disguise, handing back a diesel Renault Modus....


Sorry this is PH after all...


In all seriousness hope you find a reasonable way out of the situation

[Rally2]

Speak to CAB, they'll have the knowledge and power to help you, likely, if you don't want to incur bad credit you could offer to pay 'x' amount until whatever debt is cleared off, but again CAB would be your greatest ally.

[cpas]

Are you in a position to take the car on yourself? Your Mum could buy herself an old banger that she could afford, and you could have her car (if you really wanted it that is!!)

[2manycars]

confusedson said:

2manycars said:

You've done a really nice thing for your mother there, so give yourself a pat on the back.

Obviously i don't know your mothers situation, i.e. How old she is, health, commitments and such.

Is there no way she could get a part time job at nights in the pub, cleaning or serving. This should cover the £200 per month, save a bad credit score, plus she'll get too meet new people.

I'm not preaching so please don't take offence, it's just that sometimes people overlook the obvious.

Hope everything works out for you both.

Pete

Thanks Pete. No offence taken. We've been trying to get her to get a wee part time job but she's not looking into it seriously. She's had my Dad supporting her for the past 40 years with her having the odd part time job here and there for something to do.

She's been burying her head in the sand for a while but thinks this will all just blow over and as long as I'm paying for the car it she just carry on as if nothing has happened.

It may sound harsh but maybe losing the car will be a wake up call for her.

It might well be.

I understand your mums view on it though, imagine if you'd been looked after for 40 years and then you find yourself totally independent for the first time. That could be quite harrowing.

Either way i truly hope you come out of this pickle fine.

Pete