Voluntary Termination Question

[ROB0147]

I am looking to carry out my right for early termination of my HP car finance, but wanted a little advice on how I go about it. I know that I need to send a letter once my payments have exceeded 50% of the cars value. What I wanted to know it whether I could apply with one more payment to go? My goal is to apply at the beginning of Feb19 with one more payment due on the 17th of that month which makes it 50%. Would you recommend I wait and avoid showing my hand, or would this offer be acceptable? Thanks I’m advance. Rob.

[R0b]

I know that I need to send a letter once my payments have exceeded 50% of the cars value.

A common misconception which both debtors and finance companies get wrong. VT is not conditional on paying 50% of the total price, rather you can terminate at any time i.e. 6 months' into the contract but if you haven't paid 50% then you will be liable for the remaining balance (as a debt).

I see a lot of finance companies refusing to process or accept a termination notice on the premise that debtors have not yet reached the 50% mark. That should be a real concern for them because they run the risk that they are in repudiatory breach with the result that debtors are entitled to accept (usually by giving notice) and then are discharged from all obligations and entitled to claim damages as if the contract had been performed - for example, the car transferred into your name or the value of it.

I haven't really suggested going down the route of repudiatory breach on the forum but it seems to become more appropriate with certain companies who (appear to) have a policy of refusing to accept a VT letter unless certain conditions apply.