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 I've got two cars on finance

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T O P I C    R E V I E W
rachel.mc Posted - 20 February 2009 : 19:37:15
I've got two cars on finance one is mine and is registered in my name and the other i got for my partner as he has bad credit and is registered in his name. What would happen to them if i went bankrupt?
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John Posted - 21 February 2009 : 00:29:29
Hi

these are probably on HP agreements in that case.
Most HP agreements have a clause regarding bankruptcy in that the lender may, if they wish, repossess irrespective of whether or not the repayments are up to date or not.

The question of the repayment being allowed against expenditure depends on whether or not you can evidence that you need a car for work purposes and also if the OR considers the repayments to be excessive.
You'll not be able to fund a Maserati but something of around £2.5K to £3K may be ok if the lender agrees. The 2nd vehicle will not be allowed and unless the finance is formally transferred to a 3rd party I think it will be lost.

timendi causa est nescire
rachel.mc Posted - 20 February 2009 : 22:55:20
To be honest i'm not sure what kind of loan they are, they were both taken out with the dealer (Peugeot Finance & Perry's which is through GMAC) all monthly payment are the same amount each month bar administration costs on the first and last payment of about £150. If the receiver wouldn't be interested in the cars does that mean that if i keep up with the payments of the cars i can keep them even if i go bankrupt?? If so would the payments be taken into account of my allowable expenses??
quote:
Originally posted by John
Hiif they are on HP or lease the likelihood is you would lose them both as you are legally solely responsible for the repayments on both vehicles irrespective of whose name they are registered in or who is currently servicing the repayments. If they have been financed with unsecured credit then the debts would be written off and you may get to keep one vehicle providing it is not of more than £2500 in value and you can evidence that you need it for work purposes, but the 2nd vehicle would be lost.If they are on HP or lease and either is in negative equity the Official Receiver will have no interest in the vehicle but the HP company may terminate the agreement and repossess them.timendi causa est nescire


John Posted - 20 February 2009 : 22:44:27
Hi

if they are on HP or lease the likelihood is you would lose them both as you are legally solely responsible for the repayments on both vehicles irrespective of whose name they are registered in or who is currently servicing the repayments.

If they have been financed with unsecured credit then the debts would be written off and you may get to keep one vehicle providing it is not of more than £2500 in value and you can evidence that you need it for work purposes, but the 2nd vehicle would be lost.

If they are on HP or lease and either is in negative equity the Official Receiver will have no interest in the vehicle but the HP company may terminate the agreement and repossess them.

timendi causa est nescire

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