longun

I own a 306 and want to get me a scooby at last have a bit of money saved up but how so I sell a car that is still on finance???

I know I can't sell private but a dealer won't give me the right price.

Cheers for any help.

Joe.

dsmith

Theres no reason you can't sell private. Be up front with the buyer about it,. Have them make one cheque out to the finance company for the amount outstanding and another for the remainder to you.

Bought my civic vti like this a few years ago now. Went with the owner to the finance company and checked all the paper work was cleared satisfactorily.

Dean

Ian Griffiths

You can also take full payment for the car and use the money to pay if off. If the seller trusts you to do so.

You could even take full payment for the car, go on holiday and buy an extension on the house and continue the car finance despite not owning it. Not sure on the legalities of this one though

dsmiths sounds like the best solution.

Tiggs

i think the law is that you shouldnt sell the car with money owing but if you dont tell them and then settle up anyway no one knows/cares.

hope thats right!

tiggs

MattN

sorry chaps, it's illegal to sell a car on finance as the loan is secured on the car.

If you buy a car with finance outstanding you need to resolve with the finance company.

If the current owner does not disclose this or decides to keep paying it then decides not to, the finance company actually own the car and can take it away. Leaving you out of pocket.

So beware.

MattN

yup, finance does show on an HPi check. It shows the finance company but that's all.

Once I went to see a car did an HPi it had outstanding finance. The HPi people gave me details, I called the finance company (Ford) who whilst could not tell me much did tell me the name of the person who had the finance was not the name of the person who I was buying it off.

I walked away, got my deposit back. I was very lucky. As it turned out, the guy selling it had taken it as a px from a garage. So always be very careful.

A bank loan would work to your advantage. Or a credit card??? Think they can class it as a balance transfer.

Matt

longun

Thanks for the input. So one option maybe to take out a temp loan from bank buy car from finance company then when the car is sold payback the loan. Because the loan wouldn't be secured against the car, it won't be against the law Or just be upfront which is probally easier

Cheers.

IntegraR

Well, any owner about to spend a bit of cash, would most likely do an HPi check on the vehical, and Im almost certain that outstanding finance would show up on it, and if you havent told the prospective owner, it is unlikely he would buy the car off you.

Do like everyone said, get a letter from the finance company detailing the amount outstanding, have the buyer give you a bankers draft made out to the finance company for that amount, and a bankers draft for you for the left over, but dont try and sell the car without telling the buyer there is finance outstanding, he wouldnt be too impressed to find out himself.


PS: bank loan is a good idea, as they usually have much lower interst rates anyway, as opposed to the massive rates you pay for car finance through a dealer.




[This message has been edited by IntegraR (edited 20 June 2001).]

smartie

Apparntly, if you pay off a bank loan, in full within 28 days they cannot charge ANY interest!

Check on this first tho' (but don't take the word of someone behind the desk at your local branch - maybe see an IFA?)

longun

Thanks again all, I'm taking all this on board I think my best bet will be to go see the bank manager about a loan, if not honesty is my next step and see if I can sell it if the buyer knows that the finance will be cleared straight away.

MattN

not so, you get a cooling off period but once you have the funds.......a fee of up to 3 months interest can be levied.

andy suter

i sold my old corsa which still had 2k on finnce owing to a dealer. I was up front, they gave me a Px value, took off the amount of finace owing leaving the rest to put against the new car. I had to get it in writing from the finace company how much was outstanding. I also told my finace company what i was doing.

no problem. the dealer paid off the finance. However, the finace company told me that if the dealer didn't pay the finance off, i was still liable cos the agreement was made with me, not the dealer. that was quite scary, especially as i found out after i'd sold it!..

Dave P

Remember, if you are taking bankers drafts to be sure you have checked them with the issuing bank.

A bankers draft is only as good as cash if it isn't a forgery!!!!

Dave

ptholt

Andy suter talks sense.
Having worked in car finance many years ago, it is YOU who is liable to clear outstanding finance, NOT the person you give the car too.

Have seen many default reps arguing with owners of cars who traded them in and the garages decided not to pay the finance till they sell the car on.

Get a cheque off the dealer when you leave the car and pay off the finance.
Otherwise any late payments will go on your credit rating and YOU are liable for it.

MattN

the person who has originally taken out the finance is liable but, the loan is still secured on the car so the new owner would lose out if you defaulted on payments. The new owner would have to sue the original owner, but, seeing as they can't make the repayments it's unlikely they will have the money to pay you.

It really is very simple, the finance company is a third party with an interest in the car.

If you px, a dealer will include the px value less outstanding finance, they will settle with the finance company. Whilst you are still liable for repayments if the dealer doesn't pay it off. Simply explain the situation and most finance companies will then go after the car as it's cheaper than taking you to court, then the dealer and so on.

ptholt

But don't forget matt, the finance co's log your payment record each month to the credit ref agencies (regardless of who has the car).
If you go past the 15th day of the NEXT month after a missed payment you will have a late payment put on your credit ref.

Also letting them go after the car would be a false economy as if they take it back and auction it with you having to cover any loss, plus they cant reposses until you have missed x number of payments (as stated in your finance docs) plus if it goes on long enough they take the car back you will have defaulted by then, bacng goes your credit rating... need i say more.

Trust me, i've worked there!
First National have a team of 10-15 who do nothing but default for cars/bikes that have been px'd and not settled, especially when the dealer only has one payment left on a agreement as they think they can get away with missing the last one, admittedly the bike dealers are MUCH worse, but you will loose out. Just Make sure the dealer/whoever settles it asap and get the settlement letter!


[This message has been edited by ptholt (edited 20 June 2001).]

MattN

ptholt, trust me I have worked there before as well, up untill last year.

I think we have our wires crossed.

I'm not disagreeing withn you regarding your credit rating, far from it. What I'm saying is no matter who does what until the finance has been settled the loan is secured against the car regardless of how many times it has changed hands, the current owner would be the one that loses out financially. And the original keeper/loan signee would have an adverse credit rating (but a few grand due to buying a car on finance, selling it for cash and not paying off the finance).

Also, going after the car isn't a false economy, a lot of people sell cars with outstanding finance and then default on payment, the finance company WILL get their money back, so they go after the car. Something is better than nothing and they can't let too many people get away with it so they need to make examples of people for not a lot of money!

The point I was making was that if possible never ever get involved with a car whilst it still has finance secured against it, wether you are buying or selling.

Try and get everything straight. Never trust anyone to 'do' the right thing, always assume the worst and deal directly with whoever has an interest in the product. i.e. the seller and the finance company, don't think for one minute just because someone says they will pay off the finance they will actually do it.

Likewise when selling, try to settle the finace yourself in advance to avoid having your credit rating ruined by some inept dealer or dodgy punter!!!

Markus

Before I got the blackbeast I had a mondeo ST24 (sshhh! no laughing at the back ) which I had purchased on finance. As i needed to sell the car before I could get the scooby I was in the same situation as you.

My solution was to check with the finance company (ford's own one) that I could pay off the finance in full, with no surcharge. They said I could, and there would be no surcharge.

I then went and got a bank loan to cover the outstanding finance, then paid off the finanace company and paid the money back to the bank.

Think it was lower interest rate than the finance company as well.

This meant I could sell the car, happy in the knowledge that there was no outstanding finance on it.

longun

Quite a lot to this so I'm going to take my time I think, and look at it very carfully.

Thanks again.

GranTurismo

Why not sell the car to the russion maffia?

I one a program about the ports and they found a 22B off to russia with outstanding finance.

I quote "The finance company collected the car and took no further action" Blimey no wonder honest people have to pay so much interest ;-(

PS the bloke on the docks was diddnt like the scooby much. Was it any one on Scoobynet?

Paul Wilson

If its short term, your bank may even just give you a low rate overdraft, until you sell the car. Saves a lot of form filling and cheque writing

andy suter

how do you repair a bad credit rating? and how do these 'credit repair' companies work.

ptholt

hmm credit repair companies.... i'd be interested to see what they think they can do.anyone got a url for one so i can see what the score is?

When you have credit/loan/hp etc. they keep a profile of how you make the payments. a typical 12 month period that has had payments on time would look like this.
000000000000

Signifying that 12 payments had been made all on time. One that had a late payment in the second month would show:-
010000000000

This shows one late payment, higher numbers than one mean constant defaulting from one month to the next.e.g.
012000123000
Would show that the second months payment was late, as was the thirds. Then in the fourth month all was brought back up to date till the 7th month when three payments were missed till the 10th month when it was brought back up to date again.

In some cases there are also letters involved, i can't remember the exact letters used, but these cover things like a defaulted agreement (customer has not paid for a long time so standard agreeement has been breached).
They can also show if a default notice (for late payment) has been issued.
They can also show if goods have been returned etc.

When you are searched a list is returned from the credit ref agency showing whatever finance/hp/loan/mortgage/catalogue/etc is registered against you at the address you supplied the company (and in some cases older addresses).
They will see who the lender is, the profile (as shown above) the balance, amount financed (in some cases) and the term and the inception date.

ccj's are also registered, these show when the ccj was issued, what the amount was, if its paid up etc.

As a result of this i'm struggling to think what a credit repair agency can do....
Poor payment profiles stay on record quite some time, ccj's stay about 7-8 years if i remember rightly (even if settled they will still show).
The only thing a repair agency can do (i think), is to petition the credit ref agency on your behalf to put mitigating comments next to poor payment profiles etc, also for items that are incorrect you request full details and try to get them amended. For ccj's you can get a comment placed there if there were certain mitigating circumstances that lead to the ccj to try and improve your credit rating.
But any person can do that themselves!
you dont need an agency for it, you pay a quid, send off a form to the credit ref agencies (hyperion and equifax i believe are or were the main two) they send your file by return and you can attempt to do what i have mentioned above.

Soory bout the length of that, its probably confused you even more!

p.s. Matt - you were right, i did have my wires crossed, thought you were recommending that you let the hp co take the car back
sorry about that, who did you work for ?

MattN

or added if your in negative equity!!!!

i.e. the px is lower than the settlement!!! Not uncommon these days.

But either way as ptholt says the dealer should settle the finance and deduct/add the difference to the purchasse price.

PS. Used to work for BMW Financial Services.

gareth

Thanx for the inputs guys.

Re the trade-in - I haven't looked in any detail but am guessing my bog-std but mint MY(March)99 with 22K on the clock would fetch 13K-14K today. If so then I broke even on the finance a couple of months ago.

That works out at about 50% depreciation over 3 years. Is this what people are typically finding at the moment, or am I miles out??

G

andy suter

cheers mate, that explains it very well. I can't see either how a credit record could be repaired, but they reckon on giving a money back garuntee that you can get loans etc after theyve finished which is claimed to take 5 weeks or so. I defaulted on a a credit card around 5 1/2 years ago when i was a skint student and it bloody haunts me to this day. Ive got a copy of my credit file and apart from that i'm clean but its enough to stop getting credit from some companies. I tried to find out what these credit repair bods do but they won't say, just keep gibbering on about garuntees etc...

gareth

My scoob is currently on a finance lease thru my ltd co - basically, at any point that I want to get rid of it between now and March when the lease finishes, all the remaining rentals plus the balloon payment become due to the lease co.

Most of the time this tracks the resale value of the car, so I'm allowed to sell the car on behalf of the lease co and keep the proceeds - this balances the final payment I've had to make.

What I don't really understand is how this would work in relation to PX. For example, if I were to go to my local Subaru dealer and order a UK300 :-) today with my current scoob as PX, how would the finance be settled?

It seems there's a few finance gurus in this thread so I'm hoping for enlightenment!

Cheers,
Gareth

ptholt

Gareth,
would should happen is -
the dealer will get a settlement figure from the lease co. He will then offer you a part x, then deduct the settlement amount from that part x offer, to give you the true px figure.
This figure is what will be deducted from the price of the new car to form your deposit.

MattN

Gareth,

I think 14k is a bit optimistic as a trade in. A 99 (S) car would get more like 12k.

Still you can always haggle!!!

gareth

Not too surprised by 12K though it's a 99T and I'm thinking of spending mucho dosh (WRX wagon fully loaded + PPP when available).

That works out at 60% depreciation over 3 years which is where I started from. Unfortunately it means I will never break even on the finance so will have maybe £1K to add to the cost of the new car.

G