Voluntary termination and fixed sum loan agreement

[Firehorse66]

Is anyone able to tell me if I can evoke VT for a fixed sum loan agreement with Hyundai Finance? They are saying I can only use voluntary surrender.
There are still 3 payments left to go to get to the 50%. I would like to pay these in a lump sum and then terminate.

I'd be really grateful for some guidance.
Thanks in advance

[R0b]

Re: Voluntary termination and fixed sum loan agreement

Is anyone able to tell me if I can evoke VT for a fixed sum loan agreement with Hyundai Finance? They are saying I can only use voluntary surrender.
There are still 3 payments left to go to get to the 50%. I would like to pay these in a lump sum and then terminate.

I'd be really grateful for some guidance.
Thanks in advance

Hello, the answer is no. A fixed sum loan agreement is essentially the same type of loan which you would obtain from your bank except it is used specifically to pay for the car. Unlike a hire purchase agreement, you actually own the car so it is yours to sell if you wish. I can't see how you can voluntarily surrender the car when its yours to own.

That being said, some companies have been dressing up a hire purchase agreement as a fixed sum loan agreement so you need to check the terms carefully. Things to spot out for is any clause mentioning the car being owned by the lender, whether you have to pay a balloon payment at the end to pay are examples of a hire purchase agreement, not a fixed sum loan.

[Firehorse66]

Re: Voluntary termination and fixed sum loan agreement

Thanks for the reply. There is a balloon payment at the end but no mention of the lender owning the car. I have the log book.

[R0b]

Re: Voluntary termination and fixed sum loan agreement

Difficult to say without seeing the whole of the contract. Below is an example from Santander of what a fixed term loan should be, and as you will see a fixed term is essentially fixed monthly instalments each month over a fixed period of time. If you have a balloon payment, that goes against the ethos of a fixed term loan agreement and so I'd be questioning why this is the case.

https://www.santanderconsumer.co.uk/...ixed-sum-loan/

Who is the lender?

[Firehorse66]

Re: Voluntary termination and fixed sum loan agreement

Hello Rob,

Again, thank you for your reply. I will go through the agreement carefully at the weekend. In the meantime though, I can see a mileage clause as well as the balloon payment clause. The company is Hyundai Finance.

Thank you very much,

[R0b]

Re: Voluntary termination and fixed sum loan agreement

I may have come across Hyundai before with this type of odd agreement, but FYI here is what Hyundai have to say about their fixed sum loan agreements. Again, does not seem to appear to be what you have, and like I said, just because the title of the document says Fixed Sum Loan does not mean it is, you have to look at the detail and see if it has the hallmarks of a hire purchase. Of course trying to get Hyundai or the Financial Ombudsman to come round to your thinking is another thing.

https://www.hyundaifinance.co.uk/med...yundai_fsl.pdf

[Firehorse66]

Re: Voluntary termination and fixed sum loan agreement

Thank you.

I have researched the agreement in more detail. It seems Hyundai use two agreements. 1. A fixed sum agreement which does not allow for vol. termination. It does have one final large payment at the end, but no option to hand the car back.
2. The second agreement is signed at the same time and is called a Sales Agency Agreement, which then details the buyers right to hand the car back to the finance company (Hyundai Motor Finance), who will sell it at auction but guarantee a set price...which happens to be the exact same sum as the final payment on the fixed loan agreement (which is also between the same parties). however, if the milage has been exceeded, which is detailed in the agreement, then they will not guarantee the to pay the final sum.

It seems to me, this is a very circuitous route to avoid the law in the Consumer Rights Act! It seems as if you have a PCP agreement, but you don't!