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...