Query on selling with outstanding finance

[Chris197F1]

Hi guys, hopefully someone on her may know the answer im looking for.

Im thinking of getting rid of the clio and stepping away from the hot hatch scene and getting a Golf TDI (being sensible for a change lol)

Now I have outstanding finance and as I have only owned the car for 7 months I need as much for it as possible so is there anyway I can sell it privately and pay off the finance without taking a loan out? I know it will put a lot of people off when they see that the finance will be paid off just before the sale.

Im pretty sure there is nothing I can do but thought it was best to ask first.

Chris

 

[Gez]

Don't see the problem of having outstanding finance on selling a car privately, as long as the amount outstanding is less than the cars value of course.

It's the same principles other than they'd be paying the company you owe the money to rather than yourself

 

[Chris197F1]

ahh right I see, I never thought of it like that. Need to find out exactly how much I owe

 

[Willis]

Have a look in the T&Cs of your deal, you may be able to give the car back after a certain amount of payments...

Like what Gez has said... If you sell your car for £7,000 but your settlement figure is £8,500. Then you're basically giving away £1,500 to get rid of the car. So you're out of pocket in that case. Also, you'll struggle to find somebody who'll take a car with outstanding finance (private sale), because should you decide to not pay off the finance then the finance company could seize the car from the new owner. I'm not saying you'd do that obviously, but it's the reason why most people will not go near something with outstanding finance in the private arena.

 

[Chris197F1]

Yeah they were my thoughts Willis hence my worries that nobody would be interested as I personally wouldnt buy a car with outstanding finance on it. I will probably have to bite the bullet and part ex it and carry over the negative equity onto the other car. Privately I reckon I could clear all the owed monies

 

[Chrisgti6]

It would put me off, unless you can arrange to go to the bank, pay the money in and then call the finance company to pay it off there and then. Either that or the buyer could pay the finance balance and anything over that they pay to you?

I think i'd be happy to do that if it was my buying.

 

[Willis]

That's going to be the best option for you... Well, the best option would be to keep the car to be honest. But you know what I mean hahaha!!! There's a few companies that will let you carry negative equity over but in some cases you will be required to make a cash contribution to the deal. Say you get offered £5,500 as trade-in price but again your settlement is £8,500 then the new financers might only agree to finance £7,000 of that deal against the Clio so again you'd be left looking for cash to close the deal.

IF... If the car you look at trading to has a lower value than your trade-in price then you stand a better chance of having it all go well. I did look at downgrading to a Swift Sport which we'd agreed a price of £4,500 for. My settlement figure at the time was £6,500 (trade-in of £5,500 giving me £1,000 negative equity) but the finance company would only cover £4,750 of the deal which meant I would've had to find £1,750 in cash to secure the deal. At that point, I couldn't justify spending that much extra to downgrade.

Just think about it all before you do it. Depending on the amount of negative equity you might struggle really. I suppose it depends if you can justify paying a cash lump into the deal too, like if the new car was going to save you a lot of money over the next couple of years then maybe it'd be worth it. But it's never a simple deal really.

 

[smoggy mark]

It would put me off, unless you can arrange to go to the bank, pay the money in and then call the finance company to pay it off there and then. Either that or the buyer could pay the finance balance and anything over that they pay to you?

I think i'd be happy to do that if it was my buying.

this is what i done a few years back on my dci mined you the lad who bought it of me new me so was happy i would not rip him of.

 

[Mentalpen]

Giving the car back iirc is called half and two thirds.

iirrc you have to be a minimum of 50% into the agreement and the car is subject to wear and tear conditions.

iirc this DOES NOT affect your credit rating.

If selling privately ring up the finance company and get a settlement figure and advertise it with the outstanding finance with you paying the outstanding finance in front of them on receipt of their payment on the car or to have them pay the outstanding finance with the rest going to you.

I'd also go and tell the company you want the golf off what you owe/need for the 197. They may have offered you say £6k but you need £6,500 which they may come up too.

Meaning you are starting again without a deposit but the car you now want/need.

 

[Chris197F1]

thanks for all this advice, it really is appreciated. I have contacted the dealer with the Golf I like and im going to get a setlement figure on my lunch.

 

[Stanley]

Speak to Steve Murr on here. He is a trader and might be interested in taking the car off you and paying off the finance. Might be worth a try.

 

[devilsadvocate]

Call the finance company and ask.

I had a Twingo with RCI a few years back and I called them to ask. They said I was fine to sell the car as long as I paid of the finance straight away.

 

[Prestige Car Finance]

Chris, as per my user name I am a car finance broker so feel free to ask any questions. Just a couple of things, if you sell your car privatley get the buyer to pay the finance company direct, it is illegal to sell a car with finance on it. You can hand the car back after 50% of the total amount payable has been paid, this won't effect your credit rating but it may upset the finance company so they may not lend you money again. Hope that helps.

 

[clewsey]

thanks for all this advice, it really is appreciated. I have contacted the dealer with the Golf I like and im going to get a setlement figure on my lunch.

Chris, Another possibility would be to get a sale or return option from a specialist. This way, you will get more than part-ex'ing it and the dealer will do the hardwork of selling it (with a mutually agreed commission). I've sold a 911, 182 and a 325 this way. Of course the only downside is you'll be without the car....

Something you can do as a private seller, would be to have the buyer paying off the balance over the phone for example as long as it's not negative. If it is, then you'd need to pay the extra of course. Whilst the finance company cannot go into numbers with a buyer (data protection act), they will be able to confirm with the buyer that the finance has been fully settled. It's quite simple and it sorts out the issue. If they want the car badly enough, this may be an attractive option.

Mentalpen is correct on the termination part. I voluntarily terminated my last C2S recently with 2 months remaining for a new GTS. It hasn't affected my credit rating but after 7 months you'll be far from this option I imagine (unless you got it over a short period and put a significant deposit in.

Anyway, I'm waffling, good luck whatever happens.

Simon

 

[Steve Murr]

There are a few ways of selling a car these days- of which each tier has its own value-

Private-

this is the most you will get for the car- as if the car is a mint cherished example you can try & come CLOSE to a dealers price however once your over around 7k market is limited with cash buyers & dealers have the option of finance & PX-
Having finance on your car undoubtably makes it harder to sell because its a trust thing & there isnt much of that in the car game- even in private sellers-

Private individuals are uncomfortable with paying off finance as they are not used to the situation- & because of the availabilty of cars they will just move onto the next car-
The best way out is settling the balance if you can loan the money in the short term.

If not then make everything easy- have the settlement figure ready, all the reference numbers & contact details-
Companies will take payments over the phone to clear....

I would say £7700 is total max value of the car private.


PX-
Next up PX is your next best option- but only a good option when you are trading up- not many dealers like to px with cashback to the buyer so offers will vary, also brand will make a difference- PX into renault at max price - PX into vauxhall or high street forecourt at below book value.

I would say if your trading up through renault you would get 7k MAX-
Trading up across brand- maybe 6500-6750.


Trade sale to specialists- ( like me / all vehicles, DS cars etc etc)

People that advertise on PH for these cars know the market & know the values-

An outright trade sale on your car will see offers from 5500-6500 depending on stock levels & how much the want another car on site- plus they have to warranty it as well-

Trade sale to non specialist / high street / ebay

Take it to these desperate avenues-
you are looking between 4500 & 5500 offers ....

Its a horrible climate out there dog eat dog.



Let me know your PX price I will see what I can do

S