Change Your Existing Car Finance

Are you looking to upgrade finance?

Are you looking to upgrade finance? What about ending your current agreement?

If you’ve used BuggyDough previously for your financing and want to end your agreement, then you need to directly contact your finance provider.

Once you sign your contract to finance a car, you enjoy a ‘cooling off’ period more technically known as a right of withdrawal, which is two weeks where you can pull out of the terms and conditions.

You’d still be on the hook for repaying any credit, along with interest, that is payable during this period, until you formally notify the appropriate parties of your your decision to exercise your right to withdraw.

The Consumer Credit Act 1974 has provisions guaranteeing such rights to you. You don’t, however, have the right to change your mind just because you decided you don’t like the car. Also, if you made a deposit or a down payment, that’s not likely to be refunded as it falls outside the purview of any established credit agreement.

If you choose to exercise the right of withdrawal, then the finance company will need to recover any funds that it paid to the involved car dealer. If you return the vehicle with damage, then there might trouble in recovering that full amount. The result will be you paying for any damage incurred.

If you are ending your current agreement formally, you might apply for financing for a new vehicle that you do like from a dealer you trust, using your current credit score and income, be it self-employment or working for someone else.

On the other hand, if you want to end your agreement after the cooling off period, then the financing is something you’ll have to settle. This might involve asking your loan provider for their settlement figure. This would be an amount that includes interest which you have left to pay off in your finance agreement. You’ll have to pay off the entire settlement figure completely in order for the agreement to be fully ended.

One other option is the option of voluntary termination, which is possible if you’ve paid back more than half of the total loan amount and interest. This is a case where you turn the car back in to the finance company, thus ending the finance agreement.

Do you have a car to part-exchange?

Deposits aren’t required, down payments can happen in the form of cash or a part-exchange, as this will mean a reduction in how much you’re borrowing.

Most finance providers are going to recognise a part-exchange as something that’s just as good as cash in terms of arranging financing. As such, this improves your odds of securing a loan, since it brings down how much you have to borrow. That, in turn, brings down how much you’ll pay every month, as well as draw down your total interest.

Finance companies will recognise a deposit or a part-exchange as your personal stake in buying a car. When you’re vested in a purchase, it’s more likely that you’ll keep up with making the finance payments rather than run the risk of repossession or seeing it sold if you default.

Even with a part-exchange available, the finance company is going to be responsible for thoroughly assessing your capacity to repay them by going over your credit record.

Of course a credit score that is fair or good, combined with a deposit, will put you in good standing in terms of putting in your application. Quite a few lenders can offer competitive rates to anyone with fair, good, or excellent credit.

We also have multiple lenders that particularly specialise in dealing with bad credit car financing, so don’t stress out if you know your credit score isn’t that great. If you have a bankruptcy, default, or CCJ, we still have lenders who can help.

What if I already have existing car finance?

That’s not a cause for concern. In fact, it can be good news if you’re seeking additional finance for either a used or new car.

As long as you keep up with your current finance payments, you should be a step ahead of many others in terms of arranging for more credit. When you manage your current finance responsibly and successfully, you’re building up your credit record, which demonstrates to lenders that you personally know how to handle budgeting monthly bills.

A new check on your credit will still happen, but it’s far more likely to portray you in good light, increasing your odds of getting the additional financing you asked for.

Of course, if you lag on your repayments in your current financing, then your odds will go down, as will your credit score.

Given that, it might be harder, although not impossible, to get new financing through us. Your interest rate might go up, and you’ll most assuredly have to give earnings evidence that you have steady employment or a reliable source of self-employment income.

What is voluntary termination?

Voluntary termination is sometimes abbreviated simply as VT, and there can be many reasons why you find it necessary to end a car finance agreement prematurely. Leaving the nation for overseas work would be just one example of how your fiscal circumstances change.

There are no set industry standards for this, so check with your finance company for its terms and conditions so you can know and understand them. Every finance provider is different in this regard.

Legally speaking, a finance company will grant you the right to voluntarily terminate after you have paid more than half of the money owed, in terms of payments, interest, and fees. You won’t have any additional financial penalties imposed.

Having said that, the vehicle is expected to be returned without damage, under stipulated mileage limitations, and maintained for road-worthiness.

VT is usually allowable after half the amount payable is handled, even if the market value of the vehicle is not as much as the amount that you have paid back.

If you make every payment, especially the final-agreement payment, you’re on time and not behind, then your VT won’t be recorded as a negative event on your credit report.

After a voluntary termination, you are free and clear to start applying for new car financing with your intact credit score so that you can pick out your vehicle replacement.

As you can now see, regardless of your credit report, you can likely find financing for a vehicle, as well as explore options for upgrading, even if you are currently in a vehicle finance agreement.