Car Finance

[JessicaW2]

I currently have a car on PCP finance with Black Horse which is due to finish at the end of March. The payments are £215 per month and I have been quoted a new monthly price of £173 per month if I trade it in for a new car at the same dealership. They don’t know about my IVA yet as I didn’t want to mention it there and then, other customers were close by.
As I need a car I would have to get some sort of finance for a new car if I hand that one back but am not sure what the best option is. Would a finance deal with a company that deals with bad credit be higher than the new monthly payment they’ve quoted? And are BH likely to give me credit with the IVA? I have had finance with them for 5 years and always paid on time.

[Foggy]

First you need to check what the deal is with your IVA and the PCP payments .... many arrangements anticipate at the start, and include in the agreed terms, that the monthly IVA payment will increase by the PCP amount, when the PCP ends.

With regard to BH - I have seen instances where they have been 'happy' to ignore an IVA, but, be prepared for a refusal if they carry out a fresh credit check. We have had a post, very recently, where a BH customer was threatened with cancellation and repossession part way through the PCP because they were had entered an IVA. Although, this could have been an error on the part of BH, we never heard back from the poster with the outcome.

I imagine a 'bad credit' finance company would cost far more than the current PCP. I am also mindful of the fact that this option would be clear cut credit, which the IP would have to sanction first ---- I imagine they would also have to sanction a PCP agreement, even though it is not strictly 'credit' (and especially so if the first paragraph of this response applies).

[JessicaW2]

Thank you for your reply. I did discuss this with my IVA company so they are aware that the finance will be ending and I will have to organise something for another car, they did seem to think that it wouldn’t be a problem with BH based on my previous experience with them but I’m aware that they wouldn’t know for sure.
I can’t speak to them until Monday so will run through everything then. I have had the existing arrangement for over a year and haven’t had anything from BH regarding the IVA so hopefully they’ll be ok.
This way there would be some money to go back the IVA payment which there probably wouldn’t if I had to get a new arrangement.

[Foggy]

Best of luck -- please let us know how you get on.

[JessicaW2]

Thank you, will do. It all feels a bit stressful so will be good to find out, one way or the other.

[JessicaW2]

Just as an update, I have spoken to my IVA company and they are sending me a couple of forms to complete regarding the new car and will then let me know if it’s approved or not. Given that it should be cheaper payments then hopefully it’ll all be ok.

[Mark_21]

Hey

How did you get on? IVA companies are normally understanding when it comes to car finance as these see it as an essential purchase, the logic is based on most people need a car to work, and salary that is paid as a result of the work is used to satisfy the IVA agreement. No work = no salary, although they will normally work out a monthly figure they think is responsible. If that's lower than your current agreement then in theory you should be fine.

I would be interested to know if Blackhorse approves you again, normally with an IVA you would need to consider bad credit car finance.

Blackhorse constantly reviews their risk appetite, sometimes they are happy to underwrite greater risk if you've been a client of others and without reason other times they will reject it out of hand.

If I can help in any way I will be happy to do so.

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