What happens when you hand your car back to the finance company?

Question

I bought a Renault Clio last August 06 for £2500 since i dont have any debt and no credit rating i had to take high finance (37.5%) im now paying £146.65 a month for 36 months and i still over 3000 to pay, I would like to hand this car back to finance company as i no longer wish to pay that ammount of money and i dont like the car. What happens if i were to do this?

Answer 1

The finance company will sell the car, and apply the funds received (after all costs of sale) to your balance. You would then have to pay the difference. Check with your bank. You now have a years history of paying for a car. You may be able to refinance the balance at a much lower rate!

Giving the car to the finance company is never a good idea! It wipes out your good payment history. You said you had no credit history prior to this purchase! if you let the car go back, your only credit reference will be that you did not pay, which is worse than no credit at all!

Answer 2

I am not sure of the credit rating procedures over there. Here in the states that would show as a voluntary repossession. Which lenders look at as a normal repossession. If it shows as a repo. you can count on a higher interest rate yet or no one willing to give you a loan.

My suggestion is to deal with your choice. Enjoy the car. Pay it off....

Answer 3

you will still have to pay back a lot of that lone your best bet would be to sell privatly then refinance loan smaller payments either way you will still have a debt to pay

Answer 4

You loose everything you put in it.It will go to your credit report.Best bet if you have someone you trust,let them take up the payments.Make sure you add them to your insurance.

Answer 5

musta did bussiness with the loan sharks 37.5% you got to be kidding