Hire Purchase 'Half rule' advice please?

mydogjack

Hi i'll keep this simples as I can. I am wondering can I terminate my hire purchase agreement soon.
Bought car E10,000
deposit -E4,000
interest +E1,500
total E7,500

Does my deposit count towards 'half way' rule?

Including my deposit and installments i have E6000 paid (E4000 deposit and E2000 installments)
Am I half way there or do i have to pay half of the E7,500?

mydogjack

car only worth E7000 private sale now.

ytpe2r5bxkn0c1

mydogjack wrote: »

Hi i'll keep this simples as I can. I am wondering can I terminate my hire purchase agreement soon.
Bought car E10,000
deposit -E4,000
interest +E1,500
total E7,500

Does my deposit count towards 'half way' rule?

Including my deposit and installments i have E6000 paid (E4000 deposit and E2000 installments)
Am I half way there or do i have to pay half of the E7,500?

Nobody here can answer this without seeing the finance agreement. I find it best to simply phone the company and ask.;)

foggy_lad

the half rule can be used when you have paid half the total price of the agreement/car so if your total finance cost is €10,000 and you have paid over €5,000 than you can hand the car back and walk away.

just be aware that many finance companies use lease agreements which do not have the half rule as they are not technically hire purchase agreements. Also if you ring the finance company they may deny all knowledge of the half rule or even lie and tell you it does not exist to stop you walking away from finishing paying them.

dudara

Moved to Banking & Insurance & Pensions

dudara

chris85

its the amount paid towards the finance price. This is how much you have to pay to the bank.

car €10k
deposit €3k

amount got from bank = €7k
interest = €2k

total finance price = €9k

if over €4.5k paid on these figures then the vehicle can be handed back if in good condition with no adverse affecet on your credit rating and no further liability

No arrears can be on account also.

mydogjack

cheers chris85, explains it clearly, kinda sh#t, would lose my trade-in and have to pay half finance. suppose would have been better to finance whole amount and sell car i traded in.

rev2.0

chris85 wrote: »

its the amount paid towards the finance price. This is how much you have to pay to the bank.

car €10k
deposit €3k

amount got from bank = €7k
interest = €2k

total finance price = €9k

if over €4.5k paid on these figures then the vehicle can be handed back if in good condition with no adverse affecet on your credit rating and no further liability

No arrears can be on account also.

Chris,

I think you may be wrong on this!

The Hire purchase price would be €12k so 1/2 would be €6k

Been looking into this alot lately as looking to do this with my own car!

From itsyourmoney

Joe picked a car that cost €13,300 from a car dealer. The dealer arranged a five-year hire purchase agreement for Joe, and asked for a deposit of €1,000. The total hire purchase price is €16,790.69.
In month 25 of the agreement, Joe realises that he cannot afford the repayments.

He wants to return the car under the half rule even though he has not yet paid half the hire purchase price.Half the hire purchase price of €16,790.69 = €8,395.35 (1)

Total amount Joe has paid to date: €7,595.00 (2)
(Broken down as follows)

Deposit €1,000.00

25 repayments of €260.92 €6253.00
Documentation fee €72

Amount owed (1) – (2)
(€8,395.35 less €7,595.00)

€800.35


@ mydogjack - Do you have your agreement?

chris85

rev2.0 wrote: »

Chris,

I think you may be wrong on this!

The Hire purchase price would be €12k so 1/2 would be €6k

Been looking into this alot lately as looking to do this with my own car!

From itsyourmoney

Joe picked a car that cost €13,300 from a car dealer. The dealer arranged a five-year hire purchase agreement for Joe, and asked for a deposit of €1,000. The total hire purchase price is €16,790.69.
In month 25 of the agreement, Joe realises that he cannot afford the repayments.

He wants to return the car under the half rule even though he has not yet paid half the hire purchase price.Half the hire purchase price of €16,790.69 = €8,395.35 (1)

Total amount Joe has paid to date: €7,595.00 (2)
(Broken down as follows)

Deposit €1,000.00

25 repayments of €260.92 €6253.00
Documentation fee €72

Amount owed (1) – (2)
(€8,395.35 less €7,595.00)

€800.35


@ mydogjack - Do you have your agreement?

I am right. your example doesnt say whether the HP price includes a deposit. I deal with these every day and they do not include deposits.

HP price is clearly indicated on the HP agreement. Its very clear. OP just check the agreement, it will stand out easy enough.

rev2.0

chris85 wrote: »

I am right. your example doesnt say whether the HP price includes a deposit. I deal with these every day and they do not include deposits.

HP price is clearly indicated on the HP agreement. Its very clear. OP just check the agreement, it will stand out easy enough.

On my own agreement it states:

My agreement is as follows:

5. Cash Price: 17950
6. Less Cash Deposit 3100
8. Credit to be financed 14850
9. Interest Charge 5890
10. Document Fee 63.33
11. Purchase Fee 63.33


12.Total Cost of credit (9+10+11) 6016.66
Total amount payable (8+12) 20866.66
Hire Purchase price (5+12) 23966.66

1/2 Hire purchase price stated in agreement is 11983.33

The deposit does count towards the 1/2 price

MuffinsDa

chris85 wrote: »

its the amount paid towards the finance price. This is how much you have to pay to the bank.

car €10k
deposit €3k

amount got from bank = €7k
interest = €2k

total finance price = €9k

if over €4.5k paid on these figures then the vehicle can be handed back if in good condition with no adverse affecet on your credit rating and no further liability

No arrears can be on account also.

This is wrong. Half rule is against "total HP price" which INCLUDES the deposit as others mentioned. I have spoken to itsyourmoney.com on the phone last week and they confirmed this. In this case it'll be like total HP Price 12K, half rule = 6K, 3K already paid in depoist, 3K to be paid (as installments) to reach the half.

BuffyBot

Please don't drag up really old threads - see the forum charter.