Santander finance on car

[VinceM]

OK, my wife has her car on finance with Santander, which is a 4 year deal with a balloon payment at the end.

We want rid of the car, had no luck selling, and have just seen the termination clause in the contract, which says the usual 50% paid then we can hand it back. We are just short of this, but can pay it up via a cheque if needed.

So, wife phones Santander, I don't know exactly what was said, but they were saying we had to pay another £1500 extra to do this?

I thought we could pay the difference, and then hand the car back.

Car was bought from a main dealer so I'm not expecting any nasty clauses in it, but what are my rights? I thought wae could just hand car back? I'm in the dog house with this as she hates the car and wants a new one asap!

Help!

Thanks.

[Sarnie]

Isn't the VT point when 50% of the total amount payable is paid, which is not at exactly half way through the agreement eg month 24 of a 48 month agreement, hence why you have another £1,500 to pay as you are not at the halfway point yet..........

[P-Jay]

As above, it's 50% of the total amount payable, the figure should be on the original paperwork if you still have it.

Why do you want rid? No longer needed or fancy a change? It might be worth running it for another few months until you've made another £1500 worth of payments, at least you'll have the use of the car whilst you do.

They're not going to do you any favours to help you VT it, no body VT's a car that's worth more than the outstanding amount, plus finance companies don't have the most efficient disposal procedures in place (they'll typically chuck the lot to auction in whatever state it's in) pretty much every deal that ends in VT will result in a over-all loss, so they try to avoid it as much as possible.

Edited by P-Jay on Wednesday 20th February 10:28

[sumo69]

P-Jay said:

As above, it's 50% of the total amount payable, the figure should be on the original paperwork if you still have it.

Why do you want rid? No longer needed or fancy a change? It might be worth running it for another few months until you've made another £1500 worth of payments, at least you'll have the use of the car whilst you do.

This is spot on.

David

[rfoster]

Worth also checking whether it's a PCP agreement you have (I don't think Santander do PCP's but worth checking), just in case there's a mileage clause in there. If there is, then you can still hand the vehicle back once you've made 50% of total payable under the agreement, as long as you haven't exceeded your pro rata mileage. (if you have exceeded it you can still hand it back, but there may be an excess mileage charge to pay as well.)

[VinceM]

Without seeing the agreement in front of me, I think I've worked it out, however thanks for the help, most useful.

[NIIKME]

I thought it was when 50% of the interest owed was paid which is subtly different? I handed back a BMW to BMW a few years ago after the economy crashed and I realised I was in negative equity, no problem at all. Be warned it does leave a foot print on your credit history though because a mortgage company then asked me if I had defaulted on something until I explained!

[P-Jay]

I've been out of the finance industry for 3 years now so I'm a bit rusty, but from memory it's 50% off all payments including balloons and deposits.

So buy a car for 20k - put 2k down and repay 18k followed by a 4k balloon - total amount payable would be £24k you're be able to VT after paying a total of £12k including your deposit.