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[05omegav6]

Can a car in negative equity be used as a deposit for a lease or PCP?

Without going into detail, I didn't part ex my last car, as it was felt that it should readily have achieved the outstanding finance if sold privately.

This has turned out not to be the case. Current car is also in negative equity, although by alot less. The second car is covered by my budget, the first is not, which is also creating issues.

The ONLY reason for asking the question is to try and get some sound advice for dealing with the cars, as the whole point of trading the car down and becoming employed was to reduce my costs and to improve my financial situation for obtaining a mortgage. The former having clearly not worked, and the second looking increasingly unlikely.

My options seem to be as follows:

1.Return the first car and suffer the financial consequences.
2.Sell the first car and try to raise the difference between the achieved value and the settlement figure.
3.Part exchange the first car, (or both cars for a lease car), say a £1-200 (plus the negative equity) per month deal on a wwd shitbox.

The biggest issue with option 1, is that the agreement has a settlement figure of about £16,800 and a remaining balance of about £20,400, the difference being returned interest. I understand that when the car is auctioned, it may not achieve the required amount, thereby making it impossible to calculate my liability accurately, but the finance company refuse to tell me which figure they would deduct the sale price from Assuming it achieved £13,500, would I owe £3,300 or £6,900?

The second option doesn't seem to be working either, as the car has been for sale since mid January...

[chrisgixer]

Nothing is shifting currently. Housing market, (and presumably knock on effect with cars), is apparently waiting for the election result, before anyone decides on spending.

I don't know why, but there seems to be some credence to the theory. So, sit tight.



....what are similar Mercs sales like?

[D]

Have you tried https://www.wewantanycar.com/

Some of the wbac alternatives are quite reasonable.

[Field Marshal Dr. Opti]

Personally I would avoid options one and three.

Option two, although better, is still far from ideal.

Between a rock and a hard place comes to mind, Al.

[Taxi_Driver]

If your having trouble shifting them, without losing money on them, I would rent them out assuming there still both plated as taxi's or just replate them.

Assuming you can get the same rates as Swindon (if not higher) that's £150 per week per car, which will cover all costs of insurance/maintenance/tax etc

Ok its a bit of hassle, collecting rent etc but imo it makes sense what to do with them 

[05omegav6]

Have you tried https://www.wewantanycar.com/

Some of the wbac alternatives are quite reasonable.

Depends on your definition of reasonable 
But thanks for the thought

[05omegav6]

If your having trouble shifting them, without losing money on them, I would rent them out assuming there still both plated as taxi's or just replate them.

Assuming you can get the same rates as Swindon (if not higher) that's £150 per week per car, which will cover all costs of insurance/maintenance/tax etc

Ok its a bit of hassle, collecting rent etc but imo it makes sense what to do with them 

I wouldn't trust a single one of them to pay/not smoke it it/look after it etc, so would have to be a direct sale. It would cost nearly £600 just to replate the Merc... Insignia is still plated, and was planning on shifting it at the end of the summer... currently my only MoTd transport

[The Sheriff]

Can a car in negative equity be used as a deposit for a lease or PCP?

Without going into detail, I didn't part ex my last car, as it was felt that it should readily have achieved the outstanding finance if sold privately.

This has turned out not to be the case. Current car is also in negative equity, although by alot less. The second car is covered by my budget, the first is not, which is also creating issues.

The ONLY reason for asking the question is to try and get some sound advice for dealing with the cars, as the whole point of trading the car down and becoming employed was to reduce my costs and to improve my financial situation for obtaining a mortgage. The former having clearly not worked, and the second looking increasingly unlikely.

My options seem to be as follows:

1.Return the first car and suffer the financial consequences.
2.Sell the first car and try to raise the difference between the achieved value and the settlement figure.
3.Part exchange the first car, (or both cars for a lease car), say a £1-200 (plus the negative equity) per month deal on a wwd shitbox.

The biggest issue with option 1, is that the agreement has a settlement figure of about £16,800 and a remaining balance of about £20,400, the difference being returned interest. I understand that when the car is auctioned, it may not achieve the required amount, thereby making it impossible to calculate my liability accurately, but the finance company refuse to tell me which figure they would deduct the sale price from Assuming it achieved £13,500, would I owe £3,300 or £6,900?

The second option doesn't seem to be working either, as the car has been for sale since mid January...

As far as I can see, the minute you return the car, the interest should stop accruing, so the figure would be £16,800. But, of course, they would probably value the car at less than that. Can you not get enough money together to pay them the difference between their valuation and the settlement figure minus returned interest?
How long was the original credit agreement and how far are you into it?

[05omegav6]

Five years and nine months respectively 

[The Sheriff]

Five years and nine months respectively 

Right. That's not long 

[05omegav6]

Nothing is shifting currently. Housing market, (and presumably knock on effect with cars), is apparently waiting for the election result, before anyone decides on spending.

I don't know why, but there seems to be some credence to the theory. So, sit tight.



....what are similar Mercs sales like?

Looking at Autotrader, anything from £13,500+

[The Sheriff]

It looks to me that, instead of all the convolution, you need to beg, borrow or steal about three grand to get rid of the merc once and for all.
REMEMBER...you will not be considered for a mortgage with anything other than a perfect credit record, don't break that up cause it's a bugger to put right.

[chrisgixer]

Nothing is shifting currently. Housing market, (and presumably knock on effect with cars), is apparently waiting for the election result, before anyone decides on spending.

I don't know why, but there seems to be some credence to the theory. So, sit tight.



....what are similar Mercs sales like?

Looking at Autotrader, anything from £13,500+

As pm. Long term...Sell the car ASAP, put the balance on 0% credit card and pay off the minimum payment until you get settled.

Short term, get 0% credit card and make sure the payments are met.

[Taxi_Driver]

If your having trouble shifting them, without losing money on them, I would rent them out assuming there still both plated as taxi's or just replate them.

Assuming you can get the same rates as Swindon (if not higher) that's £150 per week per car, which will cover all costs of insurance/maintenance/tax etc

Ok its a bit of hassle, collecting rent etc but imo it makes sense what to do with them 

I wouldn't trust a single one of them to pay/not smoke it it/look after it etc, so would have to be a direct sale. It would cost nearly £600 just to replate the Merc... Insignia is still plated, and was planning on shifting it at the end of the summer... currently my only MoTd transport

Blimey  that much, im pretty certain its about £160 for a first plate on a taxi in Swindon.

You haven't any non smoking mates then, that rent their cabs?? That's how I rented mine out....undercut what they are paying by £10-£20 a week usually persuades to swap cars 

I only had one bad payer....and he was easily persuaded to pay the rent when it came down to maintenance.....ie you want new tyres, cause there illegal.....pay the rent you owe and then i'll put new tyres on 

[05omegav6]

£325 for plate, £150 for a canbus interface, £100 ish for a meter, £60 meter fitting/calibration, £47 for mechanical inspection, £65-90 roof sign, £10 for plate holder, £20 for a fire extinguisher and first aid kit. £600 was a bit light