RoShamBo

iTrader: (1)

All

Situation

I have an STi4 - probably worth around £13.5k.
I have a balloon payment on the car due in April of £15k
I want to sell the Scooby & run around in the wifes car for a few months to save a few pennies.

Question

What are the ins & outs of selling - ie if I find a buyer do I need to pay off the £15k before I sell ??
Can I "hand it back" to IM (IM financed the car) & have to pay them the difference of £1.5k ??

Can anyone let me know the possiblilities.

Thanks

Ro

JoeyDeacon

I too financed my car (MY00 Impreza UK)through IM and they quoted me a Guaranteed Future Value of £9500. Now I am under the impression that once the 3 years are up I can either pay them the £9500 and keep the car or simply give it back.

Can you not just hand it back to IM and just walk away owing them no money??

Yex

Ro,

I think it will come down to what IM want to offer you for your car against what you owe...with the balance due from you to clear the finance

My finance knowledge is a little rusty but I think Joey is right about his "Guaranteed Future Value". Using this type of contract you can give the car back and walk away after the term is up or pay the money and keep the car finance free. However, if your type of contract is only a deferred payment type of deal then you would owe the balance deferred on the due date. I may be wrong and someone with more knowledge of this thing will put me right but it all depends on the type of contract you originally signed to finance the car.

Regards

Yex

RVeiga

This all depends on the type of agreement you boys have.

You can have a guaranteed value, but this tends to come with fixed miles and a big penalty per mile if you go over. (I have had both - the way I got around the fixed miles with a guaranteed value is to Sell the car before the 3 years are up).

The answer to the original post is: If the guy whom you are selling the car to has his head switched on he will check who owns the car and ensure that his money goes towards paying the finance and that you settle the 2K or so balance. How you do this U need to discuss and agree.

Typically a garage would send a cheque to the finance company and give you the balance if their is positive equity and ask for the balance with the car if negative.

Hope it helps.

..R

47 NAT

Ro, You can request a settlement figure from the finance company anytime whilst the aggrement is in flow! You dont have to see it through the pre-agreed period.
These PCP's can work in your favour as it gaurantees you against negative equity.........bearing in mind the reduction of new car prices as from last year that you will probably be up-side down as the expression goes.
If the value of the car is under the settlement figure then to clear it you'll have have to make up the difference! You can sell the car privately as long as you pay off the settlement figure within a certain period e.g. usually 10-28 days.

But as "get out of jail free card" look at your finance agreement it will have halves and thirds mentioned?? If you have met these halves and thirds you can do "volunterely termination" ..meaqning hand the car back to the fin. comp. and they cant do diddly squat about it!!

If the car exceeds the agreed mileage then you'll get charged £?.?? pence per mile (this too should be stated on the agreement)

Nath

PS:If you need any more info then I'll e mail you my number!!

47 NAT

<BLOCKQUOTE><font size="1" face="Verdana, Arial">quote:<HR>Originally posted by JoeyDeacon:
<B>I too financed my car (MY00 Impreza UK)through IM and they quoted me a Guaranteed Future Value of £9500. Now I am under the impression that once the 3 years are up I can either pay them the £9500 and keep the car or simply give it back.Can you not just hand it back to IM and just walk away owing them no money??[/quote]

Joey, when the time comes up you can;

A. Hand the car back to the finance company and walk away (Subject to the car been in reasonable condition and miles and having been kept regulary serviced)and not owe them anymore monies.

B. Pay the ballon figure and keep the car.

C. Use the equity on the vehicle (if any) on a deposit on your next vehicle.

I hope this helps.......

Nath

SCOTTY

I've been told you can also re-finance the balloon payment.

Scotty.

Scooby Doc

You and a significant portion of car owners in the UK at the moment.

You will need to clear the finance to sell otherwise an HPI check will put buyers off.

Your best bet is to sell the car privately to maximise your return on the car and settle with the finance company. They will be more than happy to settle as you will have paid interest in your first years payments rather than capital.

I am afraid its heads you lose tails you lose. You are not alone. Have that very t-shirt.

Martin

ptholt

Not totally a nightmare guys, if the car has depreciated well below the gfv you can just hand it back and not worry about re-financing the cost of the car etc, a friend of mine who runs a large alfa/fiat franchise has a shed load of stock that owes him fortunes following people handing them back at end of pcp time.

the finance companies are now clued up on this and future gfv's reflect this, however the early ones quoted mad gfv's
(i know i helped write and test the software for first national motor finance).

Trout

iTrader: (1)

Ro,

I am puzzled - how could the car have been financed by IM as they do not endorse imports.

Typically dealer PCPs guarantee a minimum future value (I have just bought a car that guarantees 50% after 36months and 45,000 miles!).

You will need to check the terms of the contract, however handing it back to IM would seem to be a problem as they will take punitive action on Subaru dealers having commercial dealings relating to imports.

R

47 NAT

<BLOCKQUOTE><font size="1" face="Verdana, Arial">quote:<HR>Originally posted by ptholt:
<B>a friend of mine who runs a large alfa/fiat franchise has a shed load of stock that owes him fortunes following people handing them back at end of pcp time.
[/quote]

Not quite true as the finance company will sell them on via closed auction,etc,etc so if they owe him bundles he's bought them in wrong........The finance companies pays the dealers when the agreement has been signed and relevant proofs of ID submitted, so therefore its the finance company that has title and ownership and its down to them how much they sell it for! Finnicky i know but thats how it works........

Nath

Subarussian

There are TWO types of contracts:

1. With guaranteed future value
2. Without dfv, just the baloon payment

You need to check which one you have.

Normally the gfv contracts specify a much lower residual (guaranteed) value - as a result your monthly payments are higher. Also there is a mileage limit and severe penalties if you exceed it.

If none of the above rings a bell and is listed on your contract you probaly have a standard baloon payment contract, which means that you do have a negative equity in your car and will have to give back to IM all the money you get from a buyer plus any difference vs the baloon amount. With this contract you can NOT just hand the car back.

Hope this helps.