CAR FINANCE

[Loub]

Could someone please tell me if an IVA was agreed with all creditors, would my car then be repossessed due it being on finance? I know it's probably a silly question but I just thought there would be a chance......

[vickir]

Is your car on HP or personal loan?

[Loub]

HI I believe it's HP through family finance, the garage sorted it out.

[ianmillington]

Most HP companies are pretty enlightened in this respect - either that or they don't want to trigger negative equity then sit in line with everyone else for the shortfall.

Generally therefore so long as you keep making the payments there shouldn't be a problem. However if you are worried about it I suggest you ask them the hypothetical question before you attempt your IVA.

Also, check your documents. There are a number of financial products that look like HP but are in fact personal loans. If it's a personal loan, then the creditor would be in the IVA.

ian

[Jo Rolland]

Whoever you approach with regards to an IVA will check as to whether the finance agreement is HP or not. If it is HP and so long as the monthly repayments are not excessive, say over £250 you should be able to keep the car and continue to make the repayments as part of your normal monthly expenditure. Also if it is HP and if the agreement finishes at any time during the IVA you will be expected to increase your contributions accordingly.

If the agreement is a loan, then the debt would be added to the other creditors and form part of your IVA and providing that the vehicle does not have a high value you should be able to keep the vehicle.

You need to check the wording of the agreement to ascertain if it is a HP agreement or not. What does it say at the top of the agreement and are there any references to termination and your rights?