Can I sell a car privately if it has finance owing?

matsil

Hi everyone,

Could someone please advise? I am thinking of emigrating, but have a 2008 (New model) Subaru Impreza - which has the better part of 20k finance on it.

I'm waiting for the garage to get back to me to see if we can do anything on it, but if they can't, then is it legal to sell a car with finance owing? I intend to sell the car to celar the finance - that is the purpose.

Assuming it is "legal" how does a potential buyer stand? What would the normal situation be? i.e. could some arrangement be made for them to provide a bank draft or something, payable to the bank rather than me....... which gives tehm the assurance that I am in fact going to clear the finance?

Many thanks.

NiSmO

This post has been deleted.

Yes It can be done. You need to contact your finance company not the garage.

Eoin

As above, it can be done - but as you're going to be penalised anyway for ending the agreement earlier, why not get a loan to pay off the finance?

May make a sale easier, and if you get a quick sale you won't pay much interest.

matsil

eoin_s wrote: »

As above, it can be done - but as you're going to be penalised anyway for ending the agreement earlier, why not get a loan to pay off the finance?

May make a sale easier, and if you get a quick sale you won't pay much interest.

Sorry - didn't make myself clear - I'm hoping the garage will sell the car for me, off their forecourt and take their margin out of the sale.......


Get a loan - unlikely.

Penalties - its a standard variable loan, not a fixed term, no penalties are not too bad.

thanks

Eoin

matsil wrote: »

Penalties - its a standard variable loan, not a fixed term, no penalties are not too bad.

Standard variable rate on a Hire Purchase loan? Is this definitely a secured loan?

racso1975

I dont think the OP took out HP for the car. I'd say it's a variable car/personal loan through the banks.

Eoin

racso1975 wrote: »

I dont think the OP took out HP for the car. I'd say it's a variable car/personal loan through the banks.

That's what I was thinking, in which case the finance isn't secured to the car so a prospective buyer wouldn't have to worry about it.

Most banks seem to have a motor loan and a personal loan as different products, but in most cases the motor loan won't be secured against the car, and it just another personal loan.

MarkN

If you owe 20k and your car is worth 20k you can sell it - finance or not.

If you owe 20k and your car is worth 15k - you need to find 5k somewhere.

The finance company do not care what you do with the car once you settle the finance with them - in theory.

Finance or HP is another way of saying you've borrowed money, that's about as complicated as it gets.

Eoin

MarkN wrote: »

If you owe 20k and your car is worth 20k you can sell it - finance or not.

If you owe 20k and your car is worth 15k - you need to find 5k somewhere.

The finance company do not care what you do with the car once you settle the finance with them - in theory.

Finance or HP is another way of saying you've borrowed money, that's about as complicated as it gets.

Yes, in practice once you settle with them, you're fine. However having HP hanging over a car isn't great for a prospective buyer, so if it's an unsecured loan, then it's one less thing to worry about.

MarkN

Once you show the new buyer a receipt from a reputable finance house, showing your loan cleared, that should be enough.

Eoin

MarkN wrote: »

Once you show the new buyer a receipt from a reputable finance house, showing your loan cleared, that should be enough.

But that's clearly not as easy for the seller and something that could turn them off a car.

matsil

thanks guys - I'll phone the bank in the morning and see what the actual situation is i.e. secured or not.

matsil

Thats great! I finally got through to AIB and it turns out that it is just a "personal loan" - I explained to the girl my motives and that if a buyer were to run a check on the car and she confirmed that "AIB would not show up as having interest in the car"...... so thats great..... it means I can jsut advertise and sell it!

THanks guys - query answered.

Eoin

I thought that may be the case with a variable rate loan. Much easier for you and the buyer now. Good luck with the sale.

craichoe

Jesus

Its a little bit scary that a person would sign up to such a large loan and not know the terms of the loan, something so basic as what it is secured on.

matsil

Anyone got ant idea what teh suggested selling price should be? It was registered in January and part from Metallic paint, it is a standard 1.5R. Obvisouly, its "like new" - since it is "new".

I think they are selling at about €25,500 with metallic since the new VRT rates - and of course it is taxed in the old system, which is better than the new rate.

Mileage - I'll check it when I get home - less than 10,000km anyway.... well below average.

Oh yeah - its a woman owner too......

Thoughts on price?

matsil

craichoe wrote: »

Jesus

Its a little bit scary that a person would sign up to such a large loan and not know the terms of the loan, something so basic as what it is secured on.

I presume you were addressing me, when you called "Jesus" - try not to let everyone else know my real identity

No serisouly, you are right - although when you put it that way it does sound a little worse than it actually is...... the short version of how I came to this situation is this: I went to the garage, with a loan from GE money secured - the garage offered to fiannce it, so I saw no harm in getting a quote - he came back with a quote from AIB for a standard car finance package - however I did not want to sign up for a "fixed" rate loan, as I envisaged paying it off earlier. So, he made a call to AIB and seeing as I am a long term customer and do everything through them, they were will to grant a "variable" loan - I just assumed it was secured against the car to be honest..... but it was a much better rate, and AIB are most trustworthy than GE anyway - so I just took it...... I "thought" I knew what I was signing up for - ignorance is bliss I guess.....

So I suppose I just wasn't a thorough as I should have been - I was happy to sign up for the loan if it was secured against the car - that fact its an unsecured loan is a bonus really...... if it had been with any other bank I would have been far more cautious...... although through this experience it just so turns out that the dice fell in my favour - it just have easily gone the otherway - so its a bit of an eye opener.....

smash

you can get the car loan changed to a personal loan but the interest rates will be higher.