voluntary termination of caravan finance

[irnbrukid207]

Hi, just some advice needed, due to loss of job a while back something has to go unfortunately, I have missed the last 2
payments on our caravan finance and have received the default notice and they will repossess it within a few weeks, I am
nowhere near the halfway point yet and as I have paid under 1/3 finance has told me they cant take me to court, am I best
to let them repossess or voluntary terminate the agreement myself, any advice would be great, thanks

[R0b]

You can still VT and in fact I believe the default specifically requires creditors to include a statement about the right to terminate in the default notice itself as it is a statutory requirement. Although you are in arrears, so long as the agreement remains alive, you shouldn't be prevent from exercising that right. I suspect the finance company will argue otherwise but they could end up unlawfully terminating the agreement and possibly end up owing you money.

Alternatively you could seek to enter into a repayment plan which should supersede the default notice provide the plan is agreed before the deadline. Equally, if the default notice is defective then they would also have wrongfully terminated the agreement but I wouldn't be relying on this.

What would you like to do?

[irnbrukid207]

Thanks Rob, we cannot afford it now anyway so just want to give it back to finance company the best and quickest way possible, there is just
over £7000 shortfall to get to the half way point, but regardless what we do that cant get paid anyway, we are already in a trust deed in Scotland at
the moment, but we managed to keep the caravan as we said it was my sisters and we got it for her, now I think were in trouble.

[R0b]

Hello

Voluntary termination is normally the option that means you pay less than a repossession. The only way a repossession may work out better than exercising the VT right is if the caravan has retained its value and is worth more than 50% of the total price.

[irnbrukid207]

Thanks Rob, I dont think its retained its value, the site we purchased it from wont buy it back as there is to much outstanding
on the finance for them, is there a good template i can use and do i need to give them notice on the VT letter or do i say i VT from
this date etc, many thanks

[R0b]

before doing anything, I suggest you read the first link and the template letters are on the second.

https://legalbeagles.info/forums/for...on-your-rights

https://legalbeagles.info/forums/for...tter-templates

[irnbrukid207]

Thanks Rob, having read it I think VT is the best solution for us, the VT will limit my liability to whats
outstanding to the halfway point only, as its a static caravan if they decide to move it or store it they
cant forward that cost onto myself, its in pristine condition still so no problem in getting any charges
on that front, would I be correct in thinking this, thanks

[R0b]

Condition is a subjective thing so don't automatically think that just because you think it is considered pristine, doesn't mean that the lender will too. On many occasions, lenders will in some way try to reclaim costs for alleged damage so be prepared to anticipate that.

[irnbrukid207]

Thanks Rob, S. 100 (1) of the CCA 1974 it says I need to make the criteria is that something I will make by agreeing to
pay to the halfway point, thanks

[R0b]

You can terminate at any time, but you are liable to pay up to 50%. Some lenders try to argue that you must have paid 50% before you can VT but that's not correct according to S.99(1) which confirms when and how you can terminate. S.100(1) merely clarifies the liability owed.

[irnbrukid207]

Thanks for your help Rob appreciate it, 1 last thing can I put a date in the VT letter, like I wish to VT this agreement on say 17/11/19 instead of immediately, gives me time to empty the Caravan, thanks again

[R0b]

Up to you, I wouldn't expect them to come and collect it immediately so you should have time anyway but it's your choice. Be aware that if the date you are selecting to terminate falls after the next due payment, you are liable to pay that instalment.

[irnbrukid207]

Hi Rob, just got a letter back this morning about the VT of the caravan, they state i cant exercise my legal right to VT as i have not paid at least half of the agreement. They refer to the signed HP agreement which states i can only return the goods in full settlement of the agreement once half the total amount has been paid, I am required to pay the shortfall in order to return the goods. Also included was a termination notice to return possesion of the caravan on 2/12/19. Any advice on what i could do next, thanksÂ*

Â*

[R0b]

Can you post up the letter redacted, I'm interested to see what they have said.

You are not required to have paid 50% before you can terminate, and it is very much a common misconceptin by finance companies. Section 99 makes that clear by saying you have the right to terminate the agreement at any time.

In your hire purchase agreement you also have the termination statement :"TERMINATION: YOUR RIGHTS" which also says:

"You have the right to end this agreement. To do so, write to the person you make your payments to."

You got two options, first you can write back to them and claim that their letter and interpretation of the law is wrong, and that section 99(1) of the CCA says you have the right to terminate the agreement at any time before the final payment becomes due. Ask them to point out in the legislation where it says you can only terminate the agreement once one half of the total price has been paid. If they don't accept your termination letter (give them 7 days), then you will treat their refusal as a repudiatory breach of the agreement, in which case you will write to them accepting their repudiation, treat the agreement as terminated with the effect that you are discharged from all future obligations - including any outstanding instalments. You will also be entitled to damages as if the agreement had been completed to it's end. Note, that you absolutely must tell them that you are accepting their breach and terminating otherwise you will be treated as wrongfully terminating the agreement.

The second option is to make a formal complaint to them highlighing the above points around section 99, if they don't uphold it then you can take it further to the Financial Ombudsman and seek compensation for the way the finance co. has handled this. It is possible the finance co. might threaten to terminate the agreement and negatively mark your credit file but that will be part and parcel of going down this route.

In either case, I am pretty confident the finance co. has got it absolutely wrong here and if any action they take does adversely affect you in any way, you might want to take legal action but that is up to you.

I can only give you the tools, you have to decide what's best for you.

[irnbrukid207]

Thanks Rob have attachedÂ*

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