RFS HP agreement

[sunshine star]

hi all, just a little advice really. Hubby got me a megane on HP by trading in a 3 mth old clio (which was also on HP)., he had to pay a £2k deposit when buying the megane. However the deposit doesn't show on the HP agreement - only £600 (I'm assuming the difference was due to the clio).

Anyway we're 18mths into the contract and I don't want the car anymore. The only offers to buy were £4700 from a dealer but we owe £8k on it. If we hand it back now we will have to pay £3.6k and have no car.

Is there anyway to get out of this?

We can just afford it but I don't use it and the fuel consumption when I do is awful. The £206 per month plus insurance would be better spent elsewhere!

advice would be truly appreciated.

[chesham]

Sorry, could you edit your post?

You say only £600 shows on the HP agreement? Is that right??

 

Also, how much was the car when you bought it - If you paid a £2000 deposit and you owe £8000 on the car..........? How much was the p/x?

[sunshine star]

hiya, apologies - not very clear. Only £600 of the deposit shows on the contract so i'm assuming the £1400 difference is due to returning the clio?

We have 18 months remaining on a 3yr contract of which we have been paying £203 per month. hope this is more clear! cheers

[chesham]

I would have thought the whole deposit including the p/x would have shown on the agreement.

 

I'm assuming the only remedy to get out of the contract within your ts and cs are voluntary termination - which is to part with the vehicle and pay a nominated fee. However, very few HP agreements actually say what to do if you cannot afford it any longer.

 

In effect, you signed a contract saying that for the term specified, you agree that you are willing and able to pay the amount until such time that the agreement is exhausted - however, you now can't. Most companies have specialist teams in dealing with customers who fall into difficultly with repayments, I'm not sure if the HP company you are dealing with also have this provision?

 

Another option you have would be to obtain a loan with a low interest rate and pay off the HP company - but would only recommend this if you end up paying less, the same or a small amount more as the monthly payments would decrease and maybe more managable.

 

However, getting out of a contract is not very easy without being penalised for the benefit of doing so - have you tried getting quotes for the car privately and seeing how much you can raise then? Although it might not be that much more, some traders will knock off a lot more money than in a private sale and therefore it can make the difference by as much as a couple of thousand pounds.

 

Contact a citizen's advice bureau and see if one of their financial advisors can arrange something on your behalf with the finance company, as they are bound to have some ideas, and they are really good when it comes to financial problems.

[sunshine star]

I'll try the cab then. Renault finance wouldn't take it back and we didn't have any luck selling it privately. thanks for your advice

[JonCris]

tedsbird read the small print you should see a clause which refers to the 1/3 & 1/2 rule. After paying 1/3 the hp company is required to obtain a court order to repossess it. After paying 1/2 you can return the car without penalty provided it's in "reasonable" condition

[sunshine star]

hiya, I have paid one third but if I refused to continue paying would they not default my credit rating and get a court order to take the car anyway? hubby is a bit of a stickler in terms of being all above board and paying his dues so doubt he would not stop paying especially if that meant not having the car, having to pay fees and a bad credit history too!

 

We can pay up to the half way but it's another £3600 so we may as well keep paying for the car until the half payment is due rather than be out of pocket and out of car! we can just afford it but in my eyes it's a waste of money as it is hardly used and costs around £300 a month to sit on the driveway.

[JonCris]

tedsbird You have answered your own question me thinks