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How do I End My Current Finance Agreement?

Tim Carpenter, Dedicated car finance expert
Written by Tim Carpenter
Edited on

If you have previously used CarFinance 247 to take out finance and wish to end the agreement, you will need to contact your finance provider directly.

After signing a contract for car finance, you have a “right of withdrawal” (sometimes popularly called a “cooling off” period) from its terms and conditions within 14 days.

You still need to repay any credit – plus interest – payable during the period until your formal notification to exercise your right of withdrawal.

These rights are guaranteed by the provisions of the Consumer Credit Act 1974. It doesn’t allow you to change your mind simply because you don’t like the car itself and any deposit you might have made the car dealer as a down payment is outside the scope of the credit agreement and unlikely to be refunded.

When you exercise your right of withdrawal, the finance company needs to recover the funds it has already paid over to the car dealer concerned. Difficulties in recovering that amount may arise if the vehicle has been returned damaged – with the result that you may have to pay for the damage that occurred.

When you have formally ended any current agreement, you may apply for car finance a new to buy the vehicle of your choice from any reputable dealer, with your existing credit score taken into account, along with any income you are earning from employment or self-employment.

If you are past the “cooling off” period and wish to end your agreement, you will need to settle the finance. This involves asking the loan provider for a settlement figure, which is the amount (including interest) that you have left to pay on your finance agreement. You must pay off the entirety of this settlement figure in order to end the agreement.

Another option, if you have repaid at least 50% of your total loan amount (including interest) is to opt for Voluntary Termination, which is where you hand the car back to the finance company and consequently end the finance agreement.

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Tim Carpenter, Dedicated car finance expert
Tim Carpenter Car Finance Expert

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