i took out my car on finance over 4 years.ive now had it for 3 years and still owe the remaining year.

now the finance company say that im quite within my rights to terminate the agreement and hand the car back without paying a penny more as long as the car is in good condition.they said they will send someone round to the house from the RAC to inspect it and if theres anything wrong with the car which isnt classed as wear and tear i will have to pay for myself to get put right.now this could prove quite expensive for me as the car has a week left on the mot,needs work doing to pass it and the heater matrix has leaked coolant into the car and is like a swimming pool.are they right in saying this or are they just trying to put me off handing it back?they also say i have to bring my payments up to date first because im currently in arrears of a month-is this also correct?

next question-if i tell them i cant pay a penny more and they take the car back what will happen?theres no point in keeping the car because its been sitting in the garage unused for the last 6 months so its pointless having it.and another thing,i owe £2800 when the cars only worth about £1700

are there any loopholes that anyone knows of to enable me just to hand it back easily or am i going to get ripped out by the finance company?


thanks in advance

 

It stands to reason that they want it back in the same condition that you bought it in, except of course for wear and tear. You'll probably have to bring it up to scratch, I'm afraid.

If you say you can't afford to pay it, they'll do nothing until you miss a payment, but then your credit history is buggered.

 

thats what i thought.it looks like i probably cant win either way,theyve got me by the *****

 

You could try asking them for a settlement figure if you don't hand it back.

Whats what I did in this circumstance. I realised I was well over the mileage limit with a year still to go so I would have been hit with a horrendous mileage penalty, the car was worth less than the Guaranteed Resale Price, however I had made 2/3rds of the payments.

I therefore phoned up Citreon Finance and asked for a settlement figure. They said it was £4,500 or whatever it should have been. I said what happens if I want to give the carback, she said I'll put you through to a different department.

I was asked what I wanted, aso I said to give the car back. They asked whether I had been told I could do this or had read it on the agreement, I said both! They then gave me a revised settelemnt figure which was about £1,800 or something.

I did the maths regarding trading in, keeping car, and paying mileage oenalty etc, finally deciding to trade the car in and pay the lower settlement figure.

Then had the problem that when the garage doing the trade in contacted Citreon Finance they were given a different figure! Did finally get it sorted though!

Therefore it may be worth asking for a revised settlement figure instead of handing the car back.

Chris

 

I am pretty sure that with any finance agreement that once you've paid over half you can just hand the car back and walk away. Read the small print 99% sure it should be there somewhere. Its there to protect you, things aren't always in their favour.

Jas

 

the small print says that if ive paid more than £5283(ive actually paid WELL over that),i will not have to pay any more,provided i have taken reasonable care of the goods.it doesnt actually mention it has to be in good condition which i thought i did originally but the finance company quoted 'good condition'.so theres a difference in handing a car back in 'good condition' and handing it back after taking 'reasonable care' of the vehicle.

it may well fail an mot at the moment if the RAC were to do one on it but it already has one but only for the next week or so.also the heater matrix-do you reckon because of this they could turn round and say that i havent taken reasonable care of the goods?and finally they said ill have to pay for anything that isnt wear and tear.sounds like they could well be changing their goal posts.



thanks again

 

I'd check with the CAB or the broker who sold you the finance. I'm fairly sure that the car doesn't have to be perfect to hand it back. It simply has to be worth more than the outstanding settlement figure - regardless of what repairs need to be carried out.

I handed my STI back to the finance company earlier this year, and although the car was in mint condition they wrongly assumed it wasn't driveable so sent a flatbed to collect it (instead of the norm which would have been for them to drive it back to the depot). They didn't seem overly bothered about whether or not it might be driveable. When the car was being loaded on to the flatbed, the lip spoiler was basically destroyed too (not enough clearance) and that made no difference whatsoever.

Bear in mind that the terms of the consumer credit act mean that you can hand back the car after 50% of the finance term, even if the car is worth less than the settlement figure. So you may find that the lack of MOT and matrix problems are irrelevant. It's not your responsibility to ensure the finance company can sell the car on once you've handed it back.

 

Surely the heater matrix failing is wear and tear, I take it you haven't stuck your foot through it??

 

There is also the possibility that if you were to hand the car back they may then sell it at auction with no reserve price and deduct what it fetches from the balance owed.

 

I was worried about this - my finance company told me that if the sale value of the car didn't clear the outstanding settlement figure, that I'd be liable to make up the difference. However, a quick check with my broker and it turned out that's not the case. It's the whole point of the clause in the Consumer Credit Act - it's to discourage lenders from setting up finance which will leave the consumer in negative equity.

A stern letter to the finance company pointing out that they were in the wrong soon set this straight. I also managed to get them to drop the £250 fee which they were going to charge me to 'cover the cost of the auction' - again, totally unreasonable. [img]images/smilies/mad.gif[/img]

Once you've handed back the car and got a signed receipt for it, you are not liable for it. You may even be able to hand back the car and just not mention the heater matrix; it's their responsibility to ensure the car is acceptable to them before they sign for it.