• Welcome to the LegalBeagles Consumer and Legal Forum.
    Please Register to get the most out of the forum. Registration is free and only needs a username and email address.
    REGISTER
    Please do not post your full name, reference numbers or any identifiable details on the forum.

Voluntary termination

Collapse
Loading...
X
  • Filter
  • Time
  • Show
Clear All
new posts

  • Voluntary termination

    My son took out a finance package for a car with FCA Automotive Services.
    After a couple of years he is it nearly impossible to meet the payments.
    He has sent them a copy of your letter about voluntary termination to which they replied your agreement is a motor loan plus and voluntary termination is not an option.
    They said he can either sell the car and pay off any shortfall or sell the car and have lower payments.
    He is still paying his monthly payments, with some help from members of the family.
    What is our next step we cannot keep paying out.
    The car in now parked up with no insurance.
    Any advice gratefully received , many thanks in advance
    Tags: None

  • #2
    Re: Voluntary termination

    Morning,

    It sounds like your son has signed a fixed sum loan the same as what you would get from the bank but they pay it directly to the dealer instead of you. Fixed sum loans do not offer voluntary termination as it only applies to hire purchase or conditional sale agreements. However, that does mean that the car is owned by your son and he could sell it off to pay off some of the monies but is unlikely to cover all of it, depending on whether he is using it or needs it.

    If you can upload a copy of the agreement with personal info removed I can take a look and confirm your options. You can upload photos by clicking go advanced button and then the paperclip icon or you can upload to an image hosting site and copy the link for forum thumbnail.
    If you have a question about the voluntary termination process, please read this guide first, as it should have all the answers you need. Please do not hijack another person's thread as I will not respond to you
    - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
    LEGAL DISCLAIMER
    Please be aware that this is a public forum and is therefore accessible to anyone. The content I post on this forum is not intended to be legal advice nor does it establish any client-lawyer type relationship between you and me. Therefore any use of my content is at your own risk and I cannot be held responsible in any way. It is always recommended that you seek independent legal advice.

    Comment


    • #3
      Re: Voluntary termination

      Hi sorry for the delay , it is a fixed sum loan just got the paperwork off him, they have sent him a settlement figure of £8900 the car is with £5000 at the most, what would be his next step.
      my son is ready to just stop paying and see what happens

      Comment


      • #4
        Re: Voluntary termination

        Is the settlement figure the remaining balance outstanding or does that the actual early settlement amount when the rebate is taken into account? If you ask for an early settlement figure they should under the consumer credit act give this in writing with a breakdown of how it has been calculated.

        Has your son considered the effects of what will or could happen if he just stops paying? They will apply a default, possible go to court and obtain a CCJ all of which affects his credit file for the next 6 years. It might be best to negotiate and say that the repayments are now unaffordable and would like to make reaosnable monthly instalments to repay the amount back over a period of time.
        If you have a question about the voluntary termination process, please read this guide first, as it should have all the answers you need. Please do not hijack another person's thread as I will not respond to you
        - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
        LEGAL DISCLAIMER
        Please be aware that this is a public forum and is therefore accessible to anyone. The content I post on this forum is not intended to be legal advice nor does it establish any client-lawyer type relationship between you and me. Therefore any use of my content is at your own risk and I cannot be held responsible in any way. It is always recommended that you seek independent legal advice.

        Comment


        • #5
          Re: Voluntary termination

          Originally posted by R0b View Post
          Is the settlement figure the remaining balance outstanding or does that the actual early settlement amount when the rebate is taken into account? If you ask for an early settlement figure they should under the consumer credit act give this in writing with a breakdown of how it has been calculated.

          Has your son considered the effects of what will or could happen if he just stops paying? They will apply a default, possible go to court and obtain a CCJ all of which affects his credit file for the next 6 years. It might be best to negotiate and say that the repayments are now unaffordable and would like to make reaosnable monthly instalments to repay the amount back over a period of time.

          It is the total amount payable, they have told him to sell the car and pay the balance, I always thought you couldn't do this as the car is not his property.
          Will advise him to contact them and try to negotiate lower payments.
          Many thanks for your advice

          Comment


          • #6
            Re: Voluntary termination

            On a fixed loan sum the car belongs to him from the start, its not a hire purchase but a sale agreement. If the car is worth 5k then he could sell it and use it to pay off the amount. however if as you say the sum is the total maount payable left, then that is not the correct amount for early settlement. I will try and find the right legislation to help you but woudl advise to write to them back
            If you have a question about the voluntary termination process, please read this guide first, as it should have all the answers you need. Please do not hijack another person's thread as I will not respond to you
            - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
            LEGAL DISCLAIMER
            Please be aware that this is a public forum and is therefore accessible to anyone. The content I post on this forum is not intended to be legal advice nor does it establish any client-lawyer type relationship between you and me. Therefore any use of my content is at your own risk and I cannot be held responsible in any way. It is always recommended that you seek independent legal advice.

            Comment


            • #7
              Re: Voluntary termination

              Right, here's some of the stuff you need:

              s.97 of the CCA says that the creditor must provide a statement the amount required to discharge the debtor's indebtedness within the prescribed period (I believe its 7 days) together with a statement showing how the amount is arrived at. Failure to comply means that the creditor is not entitled to enforce the agreement whilst the default (that is the failure) continues. The 7 days begins on the day after the creditor receives the request.

              s.95 of the CCa allows for a rebate on early settlement which is set out in the Consumer Credit (Early Settlement) Regulations 2004.

              Effectively the rebate is the interest charged for the remaining months left of the agreement which is what is discounted so you only need to pay the total remaining amount payable less the interest. the finance co is entitled to a small amount of compensation but I don't want to go in great detail on that just yet.

              So if you write to them and say you want to settle early in accordance with the sections and legislation above, then they should get back to you within the relevant time period. If they don't the agreement becomes unenforceable until they do, but they in most circumstances there is short window when that settlement amount is valid otherwise it would need to be re-calculated again.

              Hope that makes sense, if you need any further assistance let me know
              If you have a question about the voluntary termination process, please read this guide first, as it should have all the answers you need. Please do not hijack another person's thread as I will not respond to you
              - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
              LEGAL DISCLAIMER
              Please be aware that this is a public forum and is therefore accessible to anyone. The content I post on this forum is not intended to be legal advice nor does it establish any client-lawyer type relationship between you and me. Therefore any use of my content is at your own risk and I cannot be held responsible in any way. It is always recommended that you seek independent legal advice.

              Comment

              View our Terms and Conditions

              LegalBeagles Group uses cookies to enhance your browsing experience and to create a secure and effective website. By using this website, you are consenting to such use.To find out more and learn how to manage cookies please read our Cookie and Privacy Policy.

              If you would like to opt in, or out, of receiving news and marketing from LegalBeagles Group Ltd you can amend your settings at any time here.


              If you would like to cancel your registration please Contact Us. We will delete your user details on request, however, any previously posted user content will remain on the site with your username removed and 'Guest' inserted.
              Working...
              X