car finance query

[suzz]

Hi can anyone help, I know that car finance will not be part of an IVA but need car for work, I have paid 95% of my finance and arranged a lower payment to try and make ends meet, I am now being pressurised to increase my payments but am worried that I will not be able to meet any increased amount, they are also threatening to repossess the car if I do not increase payment, CAN THEY ACTUALLY DO THIS, they have also lodged a default notice even though I am still meeting reduced payments


Thanks suzz's other half

[Storm]

Until the final payment is made the HP provider owns the vehicle and as such can recover the vehicle.

The default notice is part of the recovery process ie once served they can apply for a return of goods order which entitles them to recover the vehicle, sell it and recover any shortfall through the County Courts.

Who is the HP provider ???

[MelanieGiles]

What are the contractual payments, and how many more do you have to make before the agreement is concluded. Also, assuming you are thinking of entering into a 5 year IVA, is the car likely to last that long? If so, I strongly recommend that you continue with the HP payments, even if you have to offer lower payments to the IVA until the agreement is concluded.

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

For further details contact me at http://www.melaniegiles.com and view my IVA blog at: http://melaniegiles.blogs.iva.co.uk

[suzz]

The contractual payments were £227.00 and should have ended January 2007, but were changed to £150.00 until our financial situation got better (found emplyoment) this has now been done but only started work in January and have to work 1 month in advance before being paid, this has been explained to Benton Finance but are still threatening to repocess.

[MelanieGiles]

Suzz

Send them as much as you can this month, even if it is at the expense of your unsecured creditors. It is far more important to hang on to the car, as if you lose that you will not be able to get to work and everyone will suffer. There cannot be that much owing on the HP agreement now, and my guess is the finance company will not repossess - but I haven't come across this company before - maybe Storm can help here as he is in the industry.

As a last resort do you have any family or friends who could help in the shorterm?

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

For further details contact me at http://www.melaniegiles.com and view my IVA blog at: http://melaniegiles.blogs.iva.co.uk

[suzz]

There is only approx £1000.00 left to pay,we are still paying the £150.00 but as you say will try and pay a bit more this month, as for family and friends i think we have exhausted their help while my husband was out of work for the last 18 months.

Suzz

[MelanieGiles]

Suzz

What stage are you at with your IVA? And what is your disposable income? I would suggest that you divert as much as you can from unsecured creditor payments to your HP payment in the run up to the IVA. It will be far better to protect the car than keep unsecured creditors serviced for the next few months.

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

For further details contact me at http://www.melaniegiles.com and view my IVA blog at: http://melaniegiles.blogs.iva.co.uk

[Storm]

Benton was aquired in 2005 by The Funding Corporation based in Chester. They can be agressive in the collections process but are normally reasonable.

Only problem being that they are collecting down the old Bentons book which makes them less commercial and your £1000 will be seen as arrears and in the priority collections process.

Melanie is right - make sure you don't miss any further payments and pay as near to the monthly payment as you can.

On a possitive note they would need a Return of Goods Order from the court before they could repossess the car and the court will notify you if they apply for such an order - so no suprises.