How does Car Finance work?

can we try and stay on topic guys, only been 3 or so replies to my questions.

thanks for your reply kefkef so any money i pay before the 50% is paid is simply a kind of 'rent'? i.e. if i was hand the car back after 12 months i would recieve no money back for the 12months i have paid.?

this is confusing!
 
How is it confusing? Any finance taken out on the car means the car is owned by someone else until you pay it off, as I understand it. If you hand the car back you get nothing for it because it was never yours.
 
Gilly said:
How is it confusing? Any finance taken out on the car means the car is owned by someone else until you pay it off, as I understand it. If you hand the car back you get nothing for it because it was never yours.
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unless you get an offer of more than the outstanding finance

in which case you get the balance, surely ?

because you have enough to pay off the loan from the cash offer, and then you've got cash left over which is yours ?
 
MrLOL said:
unless you get an offer of more than the outstanding finance

in which case you get the balance, surely ?
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I would imagine so, how ever unlikely it is.

[edit]Sorry, I thought you were talking about a loan for some reason.

No, the car is not yours so if you simply hand it back to the garage you get nothing. That is my understanding of it.

If you wish to sell privately and pay off the debt in one lump sum then you get the money.
 
Gilly said:
I would imagine so, how ever unlikely it is.

[edit]Sorry, I thought you were talking about a loan for some reason.

No, the car is not yours so if you simply hand it back to the garage you get nothing. That is my understanding of it.

If you wish to sell privately and pay off the debt in one lump sum then you get the money.
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i see what your getting at

hand the car back, you get nothing

and you only get any money when selling it, if you get offered more than the oustanding finance :)
 
Gilly said:
I would imagine so, how ever unlikely it is.

[edit]Sorry, I thought you were talking about a loan for some reason.

No, the car is not yours so if you simply hand it back to the garage you get nothing. That is my understanding of it.

If you wish to sell privately and pay off the debt in one lump sum then you get the money.
Click to expand...

If i recall, if you want to sell privately with outstanding finance on the car, you need the written agreement of the finance company and the buyer pays the finance company, with any outstanding balance coming back to you if there is any from the finance company. Needless to say i would think this would put most people of buying the car and they would just go elsewhere. Other option is to take a bank loan out, pay off the finance and sell the car then pay off the bank loan, probably uncuring penalties.
 
I'm thinking about finance for a newish (low mileage) mx5, but with my credit rating I'd probably get raped on interest rates.
 
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