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GNINJA
Member Since: 18 Feb 2006
Location: Halifax
Posts: 32
  
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Hi All, its been a while since I have been on here just thought I would have your thoughts on this. I bought my disco 3, 4 years ago in March I put down 10K deposit leaving about 29k balance to be paid over 48 months with a final baloon of 16k. The dealer told me I would always have the 10k equity in the car obviously this is not the case and my car is worth just about what is outstanding, I was told when I bought the car that I could hand it back after 4 years, part ex it or re finance the balance, if I hand it back I lose the 10k and lose the Disco I dont really have any additional cash to put in against another car so I decided to refinance the 16k over another 4 years. I know the car is 100% it is my baby never lets me down and is faultless. I got intouch with HBOS who financed the car through my local dealer they have told me that there is no option to hand the car back and since they have been taken over by lloyds they do not do refinancing??? They said that I will have to find 16k in March to settle the balance or they will take me to court....... It was only 6 months ago they said I could refinance the balance. I can not find my agreement at the moment so can not check this out HBOS said this was a personal loan?? I have spoken to my local dealer who said they will take the car back of me then sell it me back with 12months warranty for the16k + 600 for the warranty this would be over 60 months. Just wondering if anyone has had a similar experience or any advice? DISCO 3 SE TDV6 BUCKINGHAM BLUE SIDE STEPS,PRIV GLASS
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 12th Jan 2010 10:45 pm |
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elemental
Member Since: 03 Jul 2009
Location: Deepest Aargau
Posts: 91
  
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GNINJA wrote:I have spoken to my local dealer who said they will take the car back of me then sell it me back with 12months warranty for the16k + 600 for the warranty this would be over 60 months.
Although I doubt that you couldn't just hand the car back if it is at the end of the lease, despite what HBOS says, it seems that the dealer is offering to have another bank refinance the remaning balance (where I am banks will only do this if the vehicle is not older than 72 months at the end of the lease). Looks like the best bet if you want to keep the car for another 5 years with some sort of warranty. Otherwise look for a personal loan for the 16k and then sell the vehicle when you want, paying the loan balance when you sell. Possibly the interest rate will be higher if you do this, but it gives you more flexibility as the loan is secured against your house and doesn't even mention the car. The 10K equity is still in the car by the way, without this 10k payment the remaining balance would be 26k, or the installments would have been higher in the last 3 years
On the HBOS new ownership thing, makes no difference to the agreement signed 3 years ago. It's a contract and remains valid whoever the owners are, unless they wrote to you with a new contract and you signed it. If in doubt contact Citizen's Advice, but clarification from HBOS with the original contract in front of you should do the trick. The lease is *sort of* a deal between the dealer and the financing bank, so the dealer has an interest in the outcome too.
If it was me and I wanted to keep the car I would accept the dealer offer to refinance, If I wanted rid then I would read the agreement carefully, double check with CAB and then ask HBOS for a written statement explaining why they won't honour the agreement. At that point they will either dig in and hope you back down, or back down and let you hand the car back and it will be either bought by the dealer for the 16k or auctioned off for the financing bank I suppose.
Either way good luck. Dig out the lease agreement and read it carefully.
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| 13th Jan 2010 8:46 am |
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cheddarwards
Member Since: 07 Aug 2006
Location: Somerset
Posts: 169
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GNINJA
I sell car & machinery finance for a living (albeit a poor living at the moment) so hopefully i can provide some insight into this.
What you say about HBOS not offering balloon re-finance is true, they pulled this option around 5 months ago. They are basically running their existing book down & not wishing to grow their book. The product i think you have been sold is a hybrid HP agreement but is not subject to the normal rules (halves & thirds) of a CCA regulated agreement & so you cannot hand the vehicle back. In some instances i have seen that these agreements are not even secured against the vehicle but are in essence personal loans.
If you want me to take a look at your copy agreement in confidence (when you find it) i am happy to, & i will offer any advice i can.
With regard to the promises the dealer made when you bought the car unfortunately it was a different world 4 years ago & sometimes people will say anything to make a sale. Cold comfort for you i appreciate, but there are ways to refinance the balloon & keep the car (PM if you wish, or you could try KAM100)
Regards
Andrew
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| 13th Jan 2010 11:03 am |
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Gaza
Member Since: 08 Jan 2009
Location: At the foot of the Lammermuirs
Posts: 448
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As the original amount being financed was over £25k the Consumer Credit Act does not apply. The rules are different now but the £25k limit was in place 4 years ago.
If you can't find your agreement I would ask both the supplying dealer and HBOS for a copy. If there is no handback option is sounds as though you had a "Lease Purchase" agreement. It is similar to a PCP in that it has a final balloon payment but unlike a PCP this is not gauranteed. Neither does it have the option to hand back the car at the end of the agreement.
I was burned by a Lease Purchase agreement with my X3. The final balloon was £13.5k but the car was only worth £9k.
You may have a case against the supplying dealer for misleading you but proving it will be difficult. However, for you to still have £10k equity in the car at the end of the lease would it would have to be worth £26k (£16k balloon plus £10k equity). Did you really believe the car would only lose £13k of value over 3 years?
There are probably many options for refinancing yourself. Your bank or other loan co may lend you £16k over 3,4 or 5 years. Try moneysupermarket.com for comparisions.
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| 13th Jan 2010 9:00 pm |
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