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Get out of your dreams and into your new car!

2nd February 2019

A guide to upgrading your car with your most common questions answered.

2nd February 2019

So, how do you get out of your old car and into a new one?

If you own your car outright…its very easy – get onto this page here and simply fill in the short Get a Quote form! 

In these circumstances, we often get the question…“What about my old car – do you take part-exchange?

Our partner companies take part exchange in most cases so no prob getting rid of the old one. The part-exchange process is very straight forward.

If you have asked us to source a vehicle, be it a car or van, through one of our partners then the normal process for part exchange is simply to request one when you have the quote on your new (or used) vehicle. The partner will normally ask you to fill out a form self-declaring the state of the vehicle you want to exchange.

They will then give you a quote for the part exchange and when it comes times to swap vehicles will check the state of the vehicle against the self declaration and all being in order will either:

  • Use the old vehicle to pay for or reduce your deposit
  • Use the part exchange money to reduce your monthly payments on your new car or van – effectively the same as increasing your deposit.
  • Pay you the money from your part exchange into your bank account.

The key point here is that part exchange is almost always an option for you with our partners…less hassle…less headache and easy as 1,2,tree!

Another common question we get is… What do I do with the existing finance?

If your car or van still has existing finance on it then you will need settle the finance depending on the type of finance you have on your existing deal or let the finance run its course. Your options are defined by what type of finance you got on your original vehicle:

  1. With Hire Purchase (HP) or a Conditional Sale (CS) agreement, it’s generally pretty straight forward – simply call the finance company and ask for the settlement figure and they must give the settlement figure to you.Our partners can often settle the finance on your behalf  and you can also part exchange your car so that it’s possible not have to make any payment directly to the old finance provider yourself.
  2. If you have a Personal Contract Plan (PCP) the process is less straightforward and its likely you may have no equity in the vehicle and owe the finance company so you may need  pay in to end the agreement early. 
  3. With Personal Contract Hire deals, your options are further restricted unfortunately and an early ending of the agreement will come with significant fees and its highly unlikely to be a good option. 

Another question we receive is…What exactly is voluntary termination and how do I voluntarily terminate my current vehicle?

 Voluntary Termination (VT)is a way to legally end your financial relationship with a lender provided you have entered into a PCP (Personal Contract Plan) or an HP (Hire Purchase) agreement. Voluntary termination rights do not cover PCH (Personal Contract Hire) or operating lease deals unfortunately.

The VT right relates to legislation within the Consumer Credit Act 1974, Section 99. This legal right means that you are entitled to apply voluntary termination of car finance without further implications provided you have paid, or will pay, 50{ce1f5a97386adb343f3d9b12b92f2c65f76aa8e98ead3145386a848fb9911aa8} of the total amount payable on the PCP or HP deal. You need to include interest and fees in this amount and you cannot have missed any payments (as you then void your Voluntary Termination rights).

There also needs to be no damage beyond “normal wear and tear” (normally supplied up front by your finance or lease company) and that you have taken “reasonable” care of the vehicle if you want to end the car finance agreement under this clause – many companies use the BVRLA’s definition of fair wear and tear which can be found here.

The Total Amount Payable (TAP) and the termination amount can be found in your original car finance agreement and you must pay off 50{ce1f5a97386adb343f3d9b12b92f2c65f76aa8e98ead3145386a848fb9911aa8} of TAP to end the finance agreement. If you have a PCP agreement, the TAP will also include the Guaranteed Minimum Future Value (sometimes known as the “balloon payment”).

Finance companies are not fans of Voluntary Terminations rights… at all! VTs cost them money, especially if the mileage on the car is very high.

Finance companies may try and put up barriers for Voluntary Termination but you should simply write to them, quoting the Act and request your legal right to VT. Be wary of being offered “termination packs” which can include clauses that actually prevent you for Voluntarily Terminating.

A key advantage of using Voluntary Termination is that the finance company cannot harm your credit rating if you VT – they are not allowed to! It can, however, refuse to finance you and if you are a repeat user of Voluntary Termination, don’t be surprised if a finance company that you applied to does not extend finance to you in the future.

Leasetree are here to help. Leasetree and our friendly partners have seen every type of finance deal. Simply go to the Special Offers page, if you see a deal you like then click on it and fill out the quick and easy application, if you don’t see a deal you like then contact us using the straight forward Get a Quote form and be sure to let us know what make and model you are after in the comments box. We have thousands of new car and van deals and hundreds of ready to go used cars so we can find pretty much any vehicle you are after.

It does not make any difference to the offer given for of your old vehicle as thus will be driven by market realities. Of course, if you are able to end your old finance agreement, you can sell your old car to who you like.