Car Finance Guarantor - Help?

Question

hi All,

I wonder if someone could offer any advice. My sister purchased a car about 9 months ago and took out finance on it. She managed to persuade my mum to go guarantor on the payments (as she has a poor credit history). She bounced the first payment so the finance company called my mum and she immediately got the Direct Debit put through her bank account to ensure the money went out every month.

However, since then, my sister (who lives at home and is turning in to more of an adult brat by the day) has not met one payment and my mum has had to pay the finance every month (my mum pays everything on time and the thought of having a payment that she's even partly responsible for being missed would fill her with horror). However, she has retained full use of the car despite not paying a penny for it.

Question is, is there anything my mum can do? Will the finance company let her sell the car? I'm not sure as my sister is the registered owner and keeper?

thanks

But as the car is registered with DVLA in my sister's name, surely the car is legally hers and my mum can't just take the keys? That's what my sister keeps saying anyway.
Personally, I'd buy a clamp and put it on the wheels to stop her driving it until she starts paying up!

Answer 1

if your mum is making the payments its her car,take the keys off your sister

Answer 2

The car is your sisters not your mothers I am afraid.

A guarantor is there to ensure payment is made to the fiannce company, they are essentially vouching for the person and saying they will pay if said person cannot. It does not imply any ownership of the car. I am afriad she cannot simly go back on the agreement simply because your sister isn't paying - that woulnd't make guarantors very useful!

Your mum could stop repayments, which would force the finance companies hand - to either send this to debt collection agencies, or to reposses the car. Not an ideal situation as you mum could end up being liable for even more - but it would resolve the situation eventually.

Not knowing a great deal about the situation - I have to say it sounds quite ridiculous! Your mum needs to stand up to your daughter, and either kick her out of the house or get her to pay her way. Alternatively she should start ebaying your sisters posessions until the sales have covered the repayments.

Answer 3

OK, messy.

Your sister may be the registered keeper of the vehicle but it is by no means clear that she is the legal owner. This depends on the type of finance agreement that was used.

If your mum stopped paying, then the company will start by going after your sister, and recovering the car. Your mum will be liable for any shortfall, but the longer this goes on the larger that figure will become.

If your sister thinks she can get away with it then she needs a wake up call. Confiscating the car is your best bet and putting some manners on her.

Answer 4

Honestly, I can't see that your mom has a way out here. Because she is the co-signer, she is legally responsible for payment if your sister fails to do so. But because mom's name isn't on the title and registration, she doesn't have the right to sell the car.

Contacting the lender to request having the contract terminated, as previously suggested, is ridiculous and a waste of time. The lender won't agree to that - why would they? The system is working exactly as it was intended: the company is getting payment from the co-signer because the first guarantor is a deadbeat. That's exactly WHY lenders get co-signers, and exactly why they won't terminate the agreement.

Truthfully, if I were mom, I'd kick sister out of the house. All she's doing is draining the family budget and taking advantage of your mom's good nature and generosity. Once out, she's still not going to make the car payment and Mom is still going to be responsible for it if she wants to protect her own credit rating. But at least she'll be taking a stand and not allowing sister to continue to mooch off of her.

Answer 5

registered keeper with DVLA is not necessarily the legal owner, so your mum could legally take keys off her and stop her using it.

but your mum stood guarantor, so legally she isl liable for the payments, that is why you have a guarantor. She is learning the hard way not to lend to family or friends. Now your sister needs to be made to understand what a debt of honour is. I would take keys and if your sister takes car report it stolen. That'll stop her.

taking the ignition leads works really well because the car wont move then.

Answer 6

You need to have a serious talk with your mom. Aside from the details of the credit issues you need to say she is enabeling your sister's behavior. And you need to get her out of denial, my experience over 100s of cases is the 99% of these situations get worse. Ask your sister if she feels bad about sticking mom with the bill, I bet she will complain that you and your mom are not doing enough for her.
Check the paperwork. Make your mom produce a copy off all the paper work. DO NOT take any verbal information, you mom will lie about the situation. and she may be paying for all sorts of other stuff.
A cosigner and gaurantor have different rights. And the loan arrangement can be different from the ownership. Is she listed on the title? If so she has rights to the vehicle, if not she only has the resonsibility to pay the loan.
Forget all that. There is only one solution that needs to happen now....take whatever loss you have to, it will be a lot less than 4 years of payments, and sell the car. Your sister can sign over some type of power of attorney and give you mom all rights to the car. Then your mom can sell it. Problem solved.

Answer 7

Hi,
First thing to do is write to the finance company, (keep a copy) and tell them that all the payments have been made by your mother, (not as though the finance company will bother who pays as long as they get the monthly payments) tell them you are (or mum) is NOT paying any further payments and suggest they terminate the agreement,.
If ask for a copy of this agreement you can check the figures, and see what amount has to be paid before the agreement is terminated, and add up what has been paid, you may have to make up the difference but better this than mum paying the lot, and sister will have to use the bus. good luck.

Answer 8

this is the downside to co signing notes -- yes your mom is libel for the loan and chances are she can not sale the car with out your sister signing over the title unless the title is made out to mom or sis and not mom and sis if it is 'or" than either can sale the car. i thank a trip to the wood shed would be the first step. good luck

Answer 9

First of all your mom is liable for the payments sell the car pay back the money you get for it and then you will have to pay the short fall and tell that stupid women to get lost loser !

Answer 10

put a clamp on your sister.