A lot of times when people get a car on finance, they start having trouble paying the monthly bills in addition to other expenditures or simply have a change of mind on the deal. So in this way, they start looking into options where they can sell the car on finance or what are the other ways out there.
Reading Time: 4 minutesA lot of times when people get a car on finance, they start having trouble paying the monthly bills in addition to other expenditures or simply have a change of mind on the deal. So in this way, they start looking into options where they can sell the car on finance or what are the other ways out there.
With Aim Motors, you can easily sell your car anytime. Just leave us an email on sales@aimmotorsltd.co.uk with the car background story and finance details, and we will handle the rest for you.
This also happens a lot because when people get a car on finance, they end up thinking since they just have to pay small amounts monthly, they’ll easily be able to cover up but that’s not the case. There are so many expenses that one has to look into like maintenance, cleaning, insurance, fuel, etc and when you add all of this together it becomes a huge total that obviously for a normal person would be hard to afford. Thus, they end up having to consider termination of the contract by legal means which does give them a set amount of loss.
Selling a car with outstanding finance
The first thing to take into account no matter your car is on hire purchase of personal contact purchase is to see what is your car’s settlement cost when you want to end the contract before time.
This amount will be what you’ll have to pay to the dealer to end the finance deal. Once you apply for the termination of the contract in a written format, the lenders have to buy any cost provide the settlement price within 12 days.
When you have a car through hire purchase or personal contract purchase, it is not legal to sell the car on your own as you’re not the owner of the car, rather the lender owns the car till you have completed all your monthly payments. And if you sell a car without informing the buyer that there is an outstanding balance, you could be sued for deception.
1. Selling car with outstanding hire purchase finance
There are different ways in which you could return the car depending on how much of the total cost you’ve paid.
- If you’ve paid lesser than half the total price of the car, then you can easily return the car by paying the left amount to get you half the car’s cost.
- Mostly, if you’ve paid over half the price then you cant return the car. However, different contracts have different rules, some contracts have the option of voluntary termination which will allow you to back out at any point without having to pay some extra amount if you’ve paid 50%. The best part is that it won’t even negatively impact your credit score.
- When you’re paying beforehand you don’t have to pay the interest but there is always an early exit price that you’ll have to pay which is cheaper depending on how much money was left to pay off.
- You can ask for a settlement figure and once you pay that off; the car will be yours and you can sell it or keep it according to your want and needs.
2. Selling a car with outstanding Personal Contract Purchase balance
This also has the same rules as that of a hire purchase finance.
You’re not the legal owner of the car so it will be illegal for you to sell the car without talking to your dealer or lender.
If you want to sell the car or pay the debt off early, you can talk to the dealer and ask for the settlement figure or choose voluntary termination. If you pay the given amounts for both, you can end the contract early and the car will be yours to keep. It is best to choose the settlement figure when the amount is less than what you’ll have to pay combined for all the months.
If you want to return the car and not pay it off early or anything, then it is doable only if you’ve paid 50% of the total cost, not just the amount you had taken from them. This also has the same rules as that of a hire purchase finance.
If you want to sell the car or pay the debt off early, you can talk to the dealer and ask for the settlement figure or choose voluntary termination. If you pay the given amounts for both, you can end the contract early and the car will be yours to keep. It is best to choose the settlement figure when the amount is less than what you’ll have to pay combined for all the months.
If you want to return the car and not pay it off early or anything, then it is doable only if you’ve paid 50% of the total cost, not just the amount you had taken from them.
3. Selling car that is paid off personal loan
Yes, you can easily sell the car if you’ve paid the complete cost of it at the start. Once you’ve paid for the car, it is yours and you’re the legal owner so it is your wish on what you want to do with the car.
But you’ve to keep in mind that you still have to pay for the loan according to whatever plan you had made to return the loan borrowed.
Once you’ve your car paid off whether, through a loan or anyway, it is completely yours so you don’t face any kind of restrictions with it on what to do and what to avoid.
These are certain ways you can opt for selling your car whilst having an outstanding balance. Always keep your pros and cons in account when taking any kind of step. It is better to do your entire research first rather than grieve later for choosing a bad option.
Aim Motors also offers best Car Part exchange services in UK and buys cars for cash. Just bring your Car at our showroom, have it inspected and get an instant offer on your car.
