Hi

I wounder if anyone could give me some legal advice on selling a car with outstanding finance.

A friend of mine obtained a car on finance @ about 44%apr. he now wants to get rid of the car and has been told by somebody that if he gets a signed declaration from the buyer that he(the buyer) will continue to pay the finance i.e assume respinsibility for all outstanding monies on the car, then my friend would be covered against the finance company. Therefore the finance company would not be able to take County Court proceeding or even record a default on my friends credit profile.

Is there anybody on here who is familiar with the legalities on this subject.

Please help

Thanks

To the best of my knowledge selling goods which are the subject of a finance agreement (i.e. hire purchase) is against the law. Basically it's not the "hirer's" property to sell until all payments (including any "option to purchase fee") have been paid and written confirmation is received from the finance company that this has been done.

A "declaration" such as you suggest isn't, I think, worth the paper it's written on. If the "purchaser" defaults it's the original hirer the finance company will be chasing. I doubt any finance company would consent to the "transfer of lability" to an unknown (to them) third party. I would suspect that a contingency such as this will be covered in the agreement's "small print" too.

Jimbo44

agree with the above - but you can usually sell it to someone if they pay the finance company what you agree for it - say there is 4K owing and car is worth 2K you can ask the finance co if you can sell it so long as funds go to them - you advertise it for 2K and sell it getting the buyer to pay the finance co directly and then you owe the reminder for soemthing you no longer have...i know of freinds who have done this but to me its worse to be paying for it and not having it!

Selling a vehicle on which HP is still owed is against the law. The way an HP agreement works is that the car dealer invoices the finance company for the car. The finance company then pays the dealer for the car and the customer hires the car from the finance company until the very end of the agreement. At this point the customer pays the finance company an 'option to purchase fee' which actually transfers ownership to the customer. It would be exactly the same as selling a rented t.v., house etc. i.e. it's not yours to sell in the first place. You wouldn't dream of selling a dvd you rented from blockbuster so why would you do it with an item worth 500 times as much. In my job I use experian car data checks every day and this can tell you whether a finance company has an interest in any car. There has however been a tendency in recent years for finance companies to sell personal loans rather than HP. In this case most of the rights given to the customer under the CCA 1974 are taken away - chiefly the right to voluntarily terminate the agreement upon paying half the total payable. Many people who have taken these loans have no idea they have a loan instead of HP as the forms they sign look very similar. If you have one of these loans you do have a right to sell the car and the finance company has no right to register an interest on experian/HPI. Many of them do register an interest but if they have you can have it removed.

Sorry to Hijack but I'd be interested on how to get them to remove it as Black Horse have done this to me and they wont reply to my letters asking them to remove it from teh HP register - any help would be great!

Likewise - any information would be great!

Sorry to Hijack but I'd be interested on how to get them to remove it as Black Horse have done this to me and they wont reply to my letters asking them to remove it from teh HP register - any help would be great!

I will take it that the agreement has now been paid off and you are wanting them to remove it so you can sell the car on. If they won't remove it i beleive the best way to do is contact the people that run the HP register requesting them to remove it.

Would it matter if its been paid off? If it is a loan as you say and not HP then you can sell the car anyway if its been paid off or not? Is that correct?

Depends what type of laon it is as far as i am aware. If it is a secured car loan them i am sure they would be within there rights to add their interest.

Thats the point - its not a secured loan, nor a HP agreement, so they shouldnt be able register their interest in it!

Depends what type of laon it is as far as i am aware. If it is a secured car loan them i am sure they would be within there rights to add their interest.

Then i agree they can't add interest and as such i would speak to HPI to have it removed

Have done so - and this is their reply:

I have spoken to one of our finance team and they have confirmed that Black Horse will not remove the financial interest against the vehicle, even if it is a personal loan. All we can recommend is that you get a letter from Black Horse confirming that the personal loan will not cause a problem with the sale of the vehicle.

I dont think this is an acceptable reponse and have replied reaffirming the fact that what they are doing is a misuse of the register - watch this space!

Then i agree they can't add interest and as such i would speak to HPI to have it removed

I would agree with you if it is a personal loan then they have no right to register any interest in the car as they don't have it. I would recommend writing to Blackhorse requesting them to remove it

The reply to the reply to the above email was as follows:

Dear Mr Hosgood

We are unable to comment further in reference to your email, we can only advise you contact the finance company as previously mentioned in the email.

Regards

Barbara

So a letter has been sent to Black Horse, it will be interesting to see the reponse!

Richard

I would agree with you if it is a personal loan then they have no right to register any interest in the car as they don't have it. I would recommend writing to Blackhorse requesting them to remove it

Of course, if you really want to get the finance company to scratch their corporate head you could ask them under which statute they they alledge they have the authority to register the car!

I have a kind of hunch the answer, (if they give a direct one), could be interesting.

Of course, if you really want to get the finance company to scratch their corporate head you could ask them under which statute they they alledge they have the authority to register the car!

 

I have a kind of hunch the answer, (if they give a direct one), could be interesting.

and what would your hunch be lol.

this is exactly the question i will be asking when i post them my next letter this weekend!

and what would your hunch be lol.

 

 

this is exactly the question i will be asking when i post them my next letter this weekend!

My 'hunch'? I don't know of any legislation giving anyone the right to register their interest in unsecured goods. Secured goods, (as in subject to a Hire Purchase Agreement, Secured Loan, Mortgage etc.), maybe, but not unsecured (as in financed by a Personal Loan such as those used for car purchase).

I could well be wrong though!!! Anyone know for sure????

If you do ask the question though, I would love to see the answer, please.

This is a copy of the letter which has been sent by me and received by Black Horse (recorded delivery)

To Sir or Madam:

Agreement number – XXXXXXXXX

Vehicle Registration – XXXXXXX

After recently obtaining a HPI check for the above vehicle (copy attached) I am concerned as to why there is an outstanding finance file shown against it.

I brought this vehicle with a Black Horse personal loan agreement, which is confirmed at the top of the signed agreement (copy attached).

As this is not a Hire Purchase Agreement, I respectfully request that you remove the file held against it on the HPI register and provide me with an explanation in writing as to why a file was placed as such.

I have been advised that unless the finance agreement is Hire Purchase, or a "secured agreement", no file should be placed on the HPI register and to do so is a serious misuse of it.

The signed agreement cannot be both a Personal Loan Agreement and a Hire Purchase Agreement – please confirm in writing which you deem the contract to be. If you deem the contract to be a Hire Purchase Agreement, then I request documentation detailing it as such.

Unless I receive a satisfactory response from Black Horse Ltd, replying to my above requests and giving written confirmation of the removal of, or the intention to remove, the file on the HPI register, I will report the misuse to the Finance and Leasing Association and proceed to take further legal action.

I would request that this letter is replied to within the next 14 days.

So we'll await the reply!

Richard

thats almost what i wrote first second and third (the third threatened legal action if they didnt reply!!)

their responce (in writing) was it IS a PERSONAL LOAN and that they are not removing thier interest unless i pay in full or the agreements ends in 3 years as planned....

i have no responded yet as unsure on wording!

yeah we arent disputing its a personnal loan, but that doesnt give them the right to register an interest in the item that was bought with it on the HPI register - to do that they need a HP agreement or a secured loan, which this isnt.

Its no different than going to the bank to borrow £3000 and spending it on double glazing for example - the loan isnt secured on the windows so they cant take them away nor can they register an interest in it so they get all the money back if you move house, so why do the same for a car?

BTW - Ive PM'ed you seeing as we are in the same boat I thought we may be able to assist each other on this bumpy road along which we tread - lol!

Richard

thats almost what i wrote first second and third (the third threatened legal action if they didnt reply!!)

 

their responce (in writing) was it IS a PERSONAL LOAN and that they are not removing thier interest unless i pay in full or the agreements ends in 3 years as planned....

 

i have no responded yet as unsure on wording!

sorry to resurect this old thread but it was very interesting...

any news from your quest guys?

Blackhorse are being total ar#es and ignoring every letter that Ive sent, and I know they have been delivered as I have proof of delivery - I am going to complain to the FSA and see what they say about it.

As for selling the car..................;-)

hi guys just picked this thread up on google i know its quite an old topiic but i am in exactly the same possition with my car bought on finance (not hp) and i wondered how it all panned out did they take it of the hpi register or not (my guess is not they always seem to get round things like that).

any reply would be most grateful

regards Steve

Black Horse Finance have caused me nothing but headaches.

I purchased a new vehicle with a previous girlfriend from a Kia showroom. After agreeing a price we arranged finance (Personal Loan) through our joint bank (Barclays) for the £22,000 it would be costing us.

As we arrived at the showroom to collect the vehicle the salesman who we had been dealing with suggested we took their finance as the rate was cheaper than what we were paying at Barclays. Before agreeing my partner and I asked for assurance that the loan would indeed be a PERSONAL LOAN. Meaning, that when it came to selling the car we would not have any problems selling it. I had personally been the victim of buying a car which had finance remaining on it back during the late 1980's, so I was aware of the potential issues involved in these matters.

After signing the finance agreement, which clearly stated PERSONAL LOAN at the top of the form we drove the vehicle away.

Two years later and my girlfriend and I went our separate ways, so we agreed that we would sell the car. This is where the grief began! After placing an advertisement a buyer viewed the vehicle and we arranged for him to collect it the following Friday. He would be paying by bank transfer and I assured him that there was no finance remaining on the vehicle.

However, on the morning when I was expecting the money to arrive into my bank account I received a call from the buyer stating that the HPi check he has initiated stated that there was finance remaining on the vehicle!

I immediately contacted the finance company who informed me that I would have to clear the remaining finance (approximately £7,000, which I did NOT have) before the car was legally owned by the new owner (who would not of course pay me until I had done this!)

Again, when I took out the loan I was assured that it was indeed a personal loan, meaning that the money could have been used for a holiday, new breasts, or indeed ANYTHING.

Had I ignored the Kia Salesman the matter would have been addressed by now. I would simply be paying off the outstanding amount each month without any problems.

The matter has now gone on for 10 MONTHS and the vehicle has depreciated further (meaning, the longer the matter goes on, the more money I lose)

I urge ANYONE considering taking a 'personal loan' through Kia/Black Horse Finance to THINK before doing so. It may be more expensive dealing with your personal bankers, but should you be considering selling the vehicle before the conclusion of the agreement and you do not have any spare cash, you will be SCREWED, and stuck with a vehicle you no longer need.

hello ppl

well here goes i privatly bought a car on the "hpi" with black horse so before i completed the sale i called them give the details as i got from hpi .

they told me everything i asked the mans name address dob amount per month an that the car was on "personal loan" but do not worrie they would remove the intrest in car.

so needless to say i bought the car

1 year on i have been in car crash (man in 4x4 run into me)

settled with my insurance sitting by letterbox for my 9000 kite (slang for cheque but i would have been better flying one)

no cheque but letter saying they had transfered the money to bh all i had to do as settle the further 3650

i called black h why do they have intrest they had reapplied it to hpi after i bought the car

so needless to say i am 9000 out of bed an no car for someone elses personal loan

if you ever see black horse stay well away they are not to be trusted with your details either but thanks to them i have the man who has benifited details

i will be colecting my money from him once his new loan comes through but not everyone is this lucky