Voluntary Termination

[bevsmith]

I am at the point where I can hand my car back (don;t need it now as work from home), and the finance company said I can as gone over 50% paid. They have told me that they will come for the car at a cost of £60, take it straight to auction for it to be sold and that the difference between what they sell it for and what I owe - I will still be liable for. I researched this and can't find anywhere that this is the case - Only to hand the car back in fair, wear and tear and that will be the end of my liability - can anyone help here at all?

[R0b]

You are correct.

Your contract terms may state there is a fee or it may not, either way when you exercise your right to VT, your liability is capped to one half of the total price. Any attempt to cause you to incur additional costs would be deemed void since it exceeds the one half cap.

Some finance companies can be difficult to handle and on some occasions they may very well affect your credit file by reporting late payments for excess mileage charges or other charges you refused to agree to, so you need to go in eyes wide open. Potentially in those situations, you may need to be prepared to go to court.

Suggest you take a read of my VT guidance document which should help answer most of your questions. Although the guidance in their is still up to date and relevant, it's probably due a refresh: https://legalbeagles.info/forums/for...on-your-rights

[bevsmith]

Thanks Rob - so as long as the 50% has been met which then triggers my right to VT - the fee could be correct but not sending the car straight to auction for me then to be liable for any value below the redemption fee?

[R0b]

Yes, think of the 50% as a maximum cap on liability and nothing in the contract can alter that. Under the CCA, it says you have a duty to take reasonable car of the car and if you don't then your liability can be increased beyond the 50% but the lender will need to provide proof. What some finance companies say is that if the vehicle sells below the expected price, the car must automatically be in an unreasonable condition and so it is the hirer who has to make up the difference.

The problem with that argument is that (a) the actual sale of the vehicle at auction does not necessarily represent the true value (b) getting the auction price is contingent on interest in the vehicle, the time of the month it is being sold and actual turnout are all of these are material factors in whether the car will sell (c) it is generally accepted that cars sold at auction are not necessarily going to achieve the same price you might expect if sold privately or even are a dealership.

Long story short, the lender needs to prove that the sale price of the vehicle was actually because of the condition of it rather than the lack of interest or turnout, something they struggle to provide an answer for if challenged, and will just regurgitate the same answers that you are nonetheless liable for the difference.