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Car Finance Expert Q&A

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Edwin Miles. Underwriting Manager

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My car has outstanding finance - Can i get a new one?

Hi, I would like to change my current car but I still have outstanding finance on the vehicle. Would it be possible to do this, if so, how do i do it?

Posted by Janis on


Hi Janis, apologies for the delayed response.

You can get a newer car even though your current car has outstanding finance. The process is quite simple really. All you need to find out is the settlement figure from your existing finance company to settle the current agreement. You then need to find out what a car dealer will give you for your current car.

Hopefully you won't be in negative equity and the car is worth more than the amount of finance you owe on the vehicle. If this isn't the case you may need a cash deposit to make up the difference. If you can't make up the difference you may be able to re-finance some of the negative equity in the new finance deal.

If you're not in negative equity the dealer will just use the difference between the price he gives you and the settlement figure towards a deposit on the new car. The dealer will then settle the finance agreement for you on your current car and you'll be free to drive off in your new car and just have one agreement in place.

We can often beat finance rates offered by dealers so please make an application when you're ready and if approved you can choose a car from any reputable dealer and we also provide a no obligation quote. Kind Regards, Edwin

Posted by on

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Hi, I bought a new car last February but received the news that we will shortly be expanding the family.

I'm looking at trading it in for a slightly bigger car that could be cheaper. My settlement figure will be around £11,000 as i have 0% interest on my deal but my car has only been valued at around £7500 due to a newer model being released since my purchase.

Will i be able to trade in my car even though there will a huge amount of negative equity? Or will it be the case i would have to get a more expensive car? Not too sure on how the equity works.

Posted by James Steptoe on


Hi James, firstly congratulations on the positive news!

Onto the matter of your current car and the negative equity. I'm afraid this isn't so good news as you're in circa £3500 negative equity. This would need to be cleared with a lump sum if you wanted to trade the vehicle in at another dealership. You'd then be free to finance another car.

If you were 50% of the way through your agreement or had paid 50% of the total amount due under the agreement (assuming you have a hire purchase agreement) you could hand your car back and walk away however, this doesn't sound like this is the case.

You may be best tying to get some other valuations from different dealers on your car. I can't see how you'd be in so much negative equity if you have a 0% agreement in place. Also, some dealers may be able to wrap up some of the negative equity into a new deal. We have a few lenders on our panel who allow customers to do this. Kind Regards, Edwin

Posted by on


I bought a car in November 2013 under a 3 year Hire Purchase agreement. I want to buy a new car as I'm not happy with my current car anymore. I recently had a settlement figure of 7,313.54 which I think is more than the car is worth. The car is worth around 5600.00. Could you please advise how I get around this?

Posted by Darren on


Hi Darren, thank you for your question.

You have a couple of options. If you are over 50% of the way through the agreement, you are entitled to opt for 'Voluntary Termination', which is where you simply hand back the vehicle and end the finance agreement .

With regards to settling your current finance, providing your application meets the criteria, we actually have lenders that can cover the negative equity and add this on to new finance.

Please contact your current finance provider for more details.

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