Can i scrap my car if i still owe finance
Can I scrap my car with outstanding finance?
When a car has outstanding finance agreement, the finance company technically owns the car until the finance is paid off in full. This means that the owner cannot scrap the car without the permission of the finance company.
In most cases, the finance company will require the outstanding balance to be paid off before they allow the car to be scrapped. There are a few exceptions to this rule, but in general, a car with outstanding finance cannot be scrapped.
This is because the law states that a car’s finance must be paid off before it is sold – whether that is as a roadworthy vehicle or for scrap. So, if you’re thinking of scrapping your car, make sure you check with your finance company first to see if you need to pay off any outstanding balances.
When a car is financed, who is the legal owner?
If you have outstanding finance on a car, then the legal owner of that car is the finance company. This means that you cannot sell the car legally until the finance has been paid off in full.
There are some exceptions to this rule, such as if you have taken out a bank loan to buy the car outright, but generally speaking, if there is finance outstanding on a car, then the finance company is the legal owner.
This also applies to scrap cars – if you have outstanding finance on a car that you want to scrap, then you will need to speak to your finance company first to get their permission. Only once you have done this will you be able to scrap the car legally.
The Best Way to Sell a Car With Finance
If you have outstanding debt on your car, you need to settle that debt before you can sell the car for scrap. Remember that there may be a fee to settle the debt early. In some cases, the finance settlement may cost more than the value of the car.
Some scrap dealers may be willing to take on the existing finance so that a sale can be made, but this is very much on a case-by-case basis. If you cannot afford to finish paying off the outstanding debt, you have no choice but to continue making your regular payments until the debt is cleared and you become the legal owner of the car.
If you do find a scrap yard who is willing to buy your car for scrap despite it being on finance, then you can be sure that this is a bad decision. No reputable scrap buyer will accept a vehicle with outstanding finance as it is not legally possible to sell a car that has outstanding finance.
The only option in this situation is to continue making your regular payments until the outstanding finance is paid off and you become the legal owner of the car.
If I scrap a car with outstanding finance, what happens?
Outstanding finance on a car is when the legal owner (the finance company) has not been paid in full by the person who bought the car. If you buy a car that still has outstanding finance, then you will become responsible for paying off the debt.
This is true even if you didn’t know that there was outstanding finance on the car when you bought it. It’s important to check the finance history of any car that you’re thinking of buying, to avoid accidentally taking on someone else’s debt.
If you do find yourself in this situation, then all you have to do is show that you were acting in good faith and you should not face any repercussions. The person that you sold the car to may also be allowed to keep the vehicle, as long as they can prove that they bought it in good faith.
In many cases, though, the finance company that is owed will simply take back the car without any further consequences for either party. Scrapping a car with outstanding finance is possible, but it’s important to speak to the finance company first to make sure that you’re doing it legally. If you don’t, then you could find yourself in hot water with the law.
If my car is written off and on finance, what happens?
If you have a remaining balance on your car and it’s written off in an accident, things can get complicated. You’ll still be liable for the payments for the remaining finance period, even though you can’t use the car.
The value of the car will also be taken into account. If you have Guaranteed Asset Protection Insurance, you’ll be in a much better position. Unfortunately, if a car is written off but you still have payments outstanding, you’ll have to pay back what you owe, even if the car is unusable.
That’s a lot easier if you have a second-hand car rather than something brand new that you’ve only had for a short time. It’s always smart to talk to your insurance company if you have an accident to find out exactly what your options are.
Remember, even if your car is written off, you’re still the legal owner of it until you sell it or scrap it. So you need to make sure you deal with it in the right way. Talk to a us if you’re not sure what to do next.
What is the amount of finance left on my car?
Many people don’t realize that it’s illegal to scrap a car with finance owing. If you do so, then the finance company will still be the legal owner of the vehicle. This means that they can come after you for the money that you owe, even though you no longer have the car.
So, before you scrap your old car, it’s important to check for outstanding finance. You can do this by looking up the car’s history using the HPI website. If there is finance outstanding on the car, then you’ll need to contact the finance company and arrange to pay off the debt. Only then will you be able to scrap the car legally.
Selling your scrap car
If you’re considering selling your car to a dealer, it’s important to be aware of the legal implications of outstanding finance. Credit reference agencies keep records of car finance agreements, so it’s easy for a potential buyer to check whether there is any outstanding finance on the vehicle. If you sell a car with outstanding finance without the knowledge of the finance lender, you could face criminal prosecution for fraud.
In order to sell your car legally, you need to obtain a settlement agreement from the finance company. The finance company must agree to accept a specified amount to cancel the agreement. Once this has been done, you are free to sell the car as scrap or as a roadworthy vehicle. Keep in mind that if you’re selling the car as scrap, you may not get as much money for it as you would if it was roadworthy.
If you’re selling an old car that is no longer roadworthy, make sure to mention this to potential buyers. You should also make sure that you are the legal owner of the car before selling It’s important to be aware of your legal rights and responsibilities when selling a car. By taking these precautions, you can avoid any legal difficulties down the line.