Car finance coming to an end - please help!

[Kazzy E]

Hi All. We are nearly three years into our IVA and I must say, it's been a great experience on the whole and has taught us some major lessons. When we started our IVA, we had special permission from our IP to purchase a car on finance which was on an option to purchase agreement with a balloon payment at the end. Amazingly, we are very close to the time when the balloon payment has to be paid which is panicking us now. We had a letter from our finance co today advising us of three options:

1) Part Exchange for another new car - even if this was agreed with our IP, there is no way we could be accepted on another agreement.

2) Hand car back to the dealership - All that money paid over the last three years for nothing.

3) Pay £4200 balloon payment to clear the agreement - we don't have this sort of money to do this.

Has anyone got any suggestions on what we can do, as it's worrying us so much. I can't be without the car as I need it to get to work as I live in a small village with no bus service to the town where I work.

Can anyone help please?

Thanks

Kazzy [:)]

[Broke of London]

Hi Kazzy,

What were your plans all along for when this happened?

You could hand the car back and try leasing a new one with a specialist in sub-prime finance. The monthly payments will be high but if your IP agrees at least you will have a car.

YOu could also ask to defer payments to save for an older car.

Or you could re-finance with a member of your family stumping up the £4200 to enable you to keep your current car.

x

[Kazzy E]

Hi Broke

Thanks for your prompt reply. At the time we took out the finance for the car, we had just been accepted for our IVA, so during that time things were extremely stressful and we were just so glad of our IP agreeing for us to have the car otherwise neither of us would have got to work. These three years have flown, and are on us before we have realised it, and now we are so worried. I don't really want to request payments to be deferred as Melanie has been fantastic to us during these three years, helping us out where she can. I am not sure she will agree to leasing although this seems like quite a good idea, but I have recently been through this procedure for my boss at work and they want to know everything in fine detail, plus they too run a credit check so we probably wouldn't stand a chance even if Melanie did accept the idea.

I only have one relative that I could ask if they could help us out, but they are pensioners and I would feel embarrassed asking, so that idea is pretty much out as well.

All I can think of, is that this is a three year old car, with good mileage for its year, and in reality is a fantastic buy for just £4K, and it greaves me to hand the keys back when we have religiously paid every month for it for three years and within days the garage will put it on its forecourt for £2K more!

We really need to keep it, but just can't think of a way that we can do it.

Regards


Kazzy

[Broke of London]

Melanie is a fantastic IP and will have seen this situation many times over. She usually posts quite late at night so if there isn't anything tonight have another look tomorrow morning. She often has some genius ideas and will be able to help you out.

Something will turn up...it always does!!

[Kazzy E]

Yes, she is great - we are very lucky to have been guided through these last three years without too many hiccups.

I was going to approach Melanie direct, but she's a busy lady, so I thought I would see if I could get some ideas/options from the forum first before I bothered her.

Thanks for coming back to me.

[;)]

[plasticdaft]

I would check with the finance company you are with to see if they would let you refinance the balloon payment if you get permission from your IP. They have seen good payment history from you so its worth a try. Do check with your IP before you attempt this though.

Wasnt this problem anticipated at the start of the iva??

Paul

[Kazzy E]

It is something we have thought about all the way through, but you tend to brush it under the carpet as three years seems a long way off. Surprising how quickly it rears its head, you're right though, it's a bit late in the day now to be worrying about it.

Kazzy

[antm]

Something to think about is some car manufacturers have a finance dept, i restructured my balloon payments, i will admit this was agreed with my IP at the start of my IVA and built in, but i had forgot to get Citroen to deal with it at the beginning so 2 years into my iva i just contacted them, showed them i could pay off the balance over time and they agreed, 18 months later the car was mine. I now have a fully paid for 5 year old car all mine. If you ask they may say yes.

Don't go to the dealer get the direct number for the finance company and speak to someone, whats the worse they can say?

[Broke of London]

Try not to worry too much. You won't be car-less even if you don't find a way to keep the car you have. Stay positive until you've spoken to Mel as she may have a few good ideas up her sleeve. x

[plasticdaft]

It is something we have thought about all the way through, but you tend to brush it under the carpet as three years seems a long way off. Surprising how quickly it rears its head, you're right though, it's a bit late in the day now to be worrying about it.

Kazzy

Please dont think I was having a go Kazzy,theres plenty things I wish I had thought of before I started my insolvency![:0]! I thought your IP may have noted there would be an issue!

Talk to the finance people and your IP and see if a deal can be done,it would be a pity to have to hand the car back.

Any family that could do the finance for you?

Paul

[antm]

I forgot to add speak to your IP as well !!

[Kazzy E]

Thanks Broke and antm. I do recall a conversation with Mel about this balloon payment where I think, if my memory serves me correctly, she did mention about approaching the finance co to see if they would refinance the balloon payment at the end. That is a good idea, and I will do that with Mel's blessing. Will they not run another credit check though? Because if they do, we don't stand a chance, even with good history, I'm sure.


Broke - I'm sure she will!

[Kazzy E]

Paul, so sorry, I didn't think that for one second. That's why I love the forum, because people raise worries long before they need to become an issue and then have time to deal with them properly. Typical OF me I'm afraid, so busy busy with work, that everything else takes a back seat, then whoops! - it's here before I know it.

I did have a conversation with Mel, time flies, it could have even been at the very beginning when we first had the car, I can't really remember, but me being a worry bum would have raised it at the time as I would have been thinking about the end of the agreement at the beginning of it, so I'm amazed at myself that I have left it til now to sort.

Let's hope I can get some good advice from Mel if she tunes in, and I thank all you guys for your sound advice.

Kazzy [;)]

[Broke of London]

We're all guilty of sticking our heads in the sand from time to time. Let's face it...that's how I ended up in an IVA in the first place!

[Broke of London]

We're all guilty of sticking our heads in the sand from time to time. Let's face it...that's how I ended up in an IVA in the first place!