If you dont pay the loan the lien holder can take possession of the property. The finance company is the lien holder.
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To sell a car with outstanding hp finance youll have to end your hire purchase agreement early.
Can you sell your car back to the finance company. You cannot sell a car with outstanding hire purchase hp finance as the lender is the legal owner of the car until the finance is settled. Inform the finance company and ask them for the settlement figure theyll need from you to pay off your loan in full. But think carefully before you do this you might still owe the lender money.
No you cant as the lender is the legal owner of the car until the finance is settled. You will have to write a letter to the financial institution stating that you are handing the car back. That way youll have a clear title that you can simply sign over to the buyer.
Basically you can do this without a black mark on your credit rating if you have paid a certain amount off your car. Carefully weigh your options and the pros and cons of each before you take action. If you are selling a car with finance still outstanding there are two things you must do before you can legally sell it.
You signed a contract with a finance company when you purchased your car. Can i sell a car with outstanding hire purchase hp finance. Financing the difference with a credit card is a bad idea though unless the card offers an exceedingly low interest rate.
Before arranging to sell your car you should let your lender know and discuss your options. If you cant afford your car payments you can give the car back to your car loan lender. This is most attractive to buyers so youll have an easier time getting the price you want.
To do this youll need to contact your finance company and ask them for a settlement figure. Itd be worth reading your contract though and speaking with your finance company to see what their usual terms and conditions are. Another good option is to sell your car and pay off the debt.
How do i sell a car under finance. You cannot sell that asset until the loan is paid. If you want to sell a car you still owe money on you can do so by following the steps below.
It will also have to state in the letter that you are liable for any money owed when sold. If you still owe money on your car and getting the title will be a hassle some buyers may be hesitant to buy. Read the tc of your finance.
In order to sell the car youll have to end the hire purchase agreement early. The lender wont write the loan balance off. This is something you should check with your dealer before you sell the car.
When you get over 50 of the way through your hire purchase agreement or you have repaid 50 of the amount owed you are within your rights to hand the car back to the finance company. If the car is now worth less than you owe consider taking a personal loan to cover the difference when you pay back the lender. If youve paid off less than half of the agreements total cost you can return the car.