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    BeagleBert's Avatar

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    Default Determining 'financial interest' following VT of hire purchase

    Evening all,

    I'll start by tagging @R0b and thank anybody that can give some advice in advance.

    Good old finance companies!

    In the search to replace my inappropriate old car, I have been through a finance broker. They advised that the approval for a new hire purchase deal was conditional on me settling my current HP; advised me then to VT (rather large negative equity to carry otherwise), as they could then move on.

    So I've today sent a voluntary termination letter to my current lender, informed the broker, only for them to respond and pretty much say, "great, now let's sit back and hope they confirm that there is no financial interest in the car any longer soon, and then we can release the finance so you can have a new car".

    ...

    I have tried my damnedest to get clarification of what the broker means by my lender confirming that there is no financial interest but they can't seem to do so.

    My question being: What can I do to confirm this with both current lender and new lender? Surely the only financial interest the lender has in the car, is the value of the car itself. My financial interest in the car is the 50% liability that I have more than paid up to the point that I terminate the agreement.

    Once I have terminated the agreement - provided I meet the conditions to do so (which I do - 50% point met etc.) - then I am no longer liable to them. Any further charges levied, I understand, are unenforceable and actually, were they to pursue for damages or mileage; is that not a financial interest they hold against me as the borrower, which I can then defend personally?

    It's a confusing stipulation that the broker has waited until I've taken the dip to inform me of and I'm now in panic mode for fear of having no car to get to work with.

    Could I call my lender and ask for them to confirm my VT via an email that states I have no further financial obligation against the agreement and use that as confirmation?

    Any advice appreciated to hopefully settle some nerves!

    Bert.

  2. #2
    R0b's Avatar

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    Default Re: Determining 'financial interest' following VT of hire purchase

    Hi Bert,

    I think I am with you on this one though I am not entirely sure why they are not able to give you a proper explanation of this. Have you got anything in writing from them to confirm this? You may want to start documenting everything just in case this goes awfully wrong (hopefully not though).

    To my mind, financial interest would only relate to the credit that was loaned to you for the purchase of the car. As you say, any damages or breach of contract are entirely separate to the 'financial interest' as the damages are secondary. I've attached an example letter (see below) that I received when I VT'd my agreement with Santander, you should receive something like it.



    If you want to speed up the process you can try to email them and attach your letter you sent to them, and asking them to confirm that they are in receipt of your termination letter and that you've paid 50% or more of the total amount payable under the agreement.
    DISCLAIMER: ANY CONTENT I POST IS INTENDED FOR EDUCATIONAL AND INFORMATIONAL PURPOSES ONLY AND IS NOT A REPLACEMENT OR SUBSTITUTION FOR LEGAL ADVICE. I MAKE NO REPRESENTATIONS AS TO THE ACCURACY OF MY POSTS NOR DO I ASSUME ANY RESPONSIBILITY. USE OF ANY CONTENT IS SOLELY AT YOUR OWN RISK AND COST AND I ACCEPT NO LIABILITY. YOU SHOULD SEEK INDEPENDENT LEGAL ADVICE BY GOING TO Law Society's Find A Solicitor OR CONTACT YOUR LOCAL Citizen's Advice Bureau.


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