Welcome Car Finance issue...
Discussion
A mate of mine (not me I promise ) brought a Rover 600 via Welcome about 6 or 7 years ago.
He had a number of problems which resulted in him reaching an agreement with them that he would pay £43.00 per month for this car.
The car is now 11 years old, and worth next to nothing.
Welcome are saying that he has to keep paying (from what I can gather) for ever....he does not even have the option of walking away from it.
Does he have any options?
He had a number of problems which resulted in him reaching an agreement with them that he would pay £43.00 per month for this car.
The car is now 11 years old, and worth next to nothing.
Welcome are saying that he has to keep paying (from what I can gather) for ever....he does not even have the option of walking away from it.
Does he have any options?
If it was normal hire purchase then he could do a voluntary termination once half the amount owing has been paid - but I guess that gets messed up once you start incurring penalties for missed payments etc. Also, I gather a lot of issues with Welcome are to do with Payment Protection Insurance - so people VT, but are then told they still owe (in some cases) thousands in PPI payments. PPI is of course, very much in the news at the moment.
He should probably go to Citizens Advice and seek help.
ETA: If has paid PPI all these years then he should claim and they might end up owing him money. The exact timing of when he took the loan is critical (hopefully after 14th Jan 2005) and the FSCS have jus ttaken over claims as they've declared Welcome to be in default: http://www.fscs.org.uk/news/2011/march/fscs-declar...
He should probably go to Citizens Advice and seek help.
ETA: If has paid PPI all these years then he should claim and they might end up owing him money. The exact timing of when he took the loan is critical (hopefully after 14th Jan 2005) and the FSCS have jus ttaken over claims as they've declared Welcome to be in default: http://www.fscs.org.uk/news/2011/march/fscs-declar...
thatone1967 said:
If I know him though, they will be in a bin somewhere...
In that case I wouldn't get involved - just change the subject when it comes up! Is £43/mth significant to him?Edited by Deva Link on Thursday 21st April 13:38
Edited by Deva Link on Thursday 21st April 13:40
there's a few options, but really depends on how they wrote the finance agreement up (poorly I imagine) and more importantly how the wrote up the revised version that agrees the £43 payment and when he started paying that amount.
I left the industry a few years ago now, but I don't think it was legal to write a finance agreement whereby the interest added was greater than the amount being paid back each month which is what would be needed to have an agreement that ran for indefinitely.
If he doesn't have a copy, tell him to write to them asking for a copy - do that anyway. I wouldn't be surprised if they don't even have a copy.
Once he has the paperwork in place get him to book some time with the CAB, if they can produce the agreement do the same, the CAB might even be able to advise a way to wash his hands of it.
I don't believe in people walking away from financial agreements usually, but Welcome are villains and by the sounds of it they're sticking the knife in your mate.
Plus they're seriously sub-prime and bad debt is very well built into their business plan.
I left the industry a few years ago now, but I don't think it was legal to write a finance agreement whereby the interest added was greater than the amount being paid back each month which is what would be needed to have an agreement that ran for indefinitely.
If he doesn't have a copy, tell him to write to them asking for a copy - do that anyway. I wouldn't be surprised if they don't even have a copy.
Once he has the paperwork in place get him to book some time with the CAB, if they can produce the agreement do the same, the CAB might even be able to advise a way to wash his hands of it.
I don't believe in people walking away from financial agreements usually, but Welcome are villains and by the sounds of it they're sticking the knife in your mate.
Plus they're seriously sub-prime and bad debt is very well built into their business plan.
The payments won't be forever. The first thing he needs is a settlement figure - if he asks for one they have to provide. Once he has this then he can decide what to do. He's been paying £516 a year - so depending on how long he has paid this fore the figure may be quite low.
Welcome are sub prime so the initial interest rates would have been high hence taking longer to pay. Get a settlment - figure out the value of the car and amount owed - then decide the best corse of action once you have all the facts.
Welcome are sub prime so the initial interest rates would have been high hence taking longer to pay. Get a settlment - figure out the value of the car and amount owed - then decide the best corse of action once you have all the facts.
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