Handing back the keys.....

engrish?

So I bought a commercial vehicle at the peak, when there were no problems getting finance. My situation has changed drastically and I am finding it very difficult to deal with the repayments and other costs (€1000 plus). I wrote to the bank asking to refinance over 5 years which would reduce my repayments to a more managable c.€640 per month and I received a PFO.

Right now I'm thinking that this outgoing could send me under. I have made efforts to negotiate with the bank but they are unwilling. The lease is taken out against me personally and not against the company. I realise that this will damage my credit rating but I doubt there will be many people left with good credit ratings by the time we come out of this!

Can anyone give me any advice? Is it possible to just ring the bank and tell them I cant pay them, that they can collect the car? Will I be sued?

daheff

did you try to refinance at a different bank?

dudara

Did you enter into a Hire Purchase agreement, or is the vehice leased?

You have different rights depending on which arrangement you entered into. There was a recent thread in the Motors forum regarding returning vehicles under the "Half Rule" in a HP agreement.

Maqnus

Can you sell it?

mcaul

Very stupid from the bank!

You've made a very reasonable offer and they have refused. If this went to court the judge would rightly give the bank a pasting.

Best option is to call into the office of the finance dept of the bank. (AIB = Sandyford Ind Est, BOI = Pembroke Road. Dublin 4, etc etc.)

Talk face to face with someone, bring supporting documentation and if they don't make a deal with you, then let them know that you'll be returning the vehicle to them.

They will then HAVE accept a reasonable payment proposal from you for setlement of any outstancding debt afetr the vehicle is sold. Only if you don't pay this can they take you to court.

If you still need a vehicle you can do a long term rental with someone like Northgate http://www.northgatevehiclehire.ie/

By doing above, it should not affect credit rating except with the financial institution you are with.

engrish?

Thanks so far folks, I entered into a business lease so I think they can chase me for the money if they need to.

I have it on the market at the moment but there is very little interest in them and the sale price will come nowhere close to the loan amount.

engrish?

daheff wrote: »

did you try to refinance at a different bank?

No banks will touch it.

smelltheglove

Ok not exact same position but since my husbands wages took a turn for the worse in the last year we found ourselves struggling to meet repayments on credit cards and loans. We had a period of around 6 months where we literally could not afford to put food on the table and he approached the bank a couple of times about refinancing. Each time declined, he was getting more and more unpaid transaction fees added on to the already mounting debt.

More recently he received a call from teh bank, from the financing department where an employee there was calling to try and help him ease the troubles on his account, apparently when he was going to the bank looking for a refinance they were just treating it as a new loan and declining it, through this person though he was able to arrange exactly what needed to be done, credit card cut up, overdraft and loan and any amount outstanding on the card were all rolled into one refinance option which has almost halfed the repayment.

We were literally shocked when this happened as we had tried and tried again but apparently we just hadnt been put through to the right department when trying to arrange the refinance. This was Bank of Ireland, and when the right guy came to us it was all sorted within 2 weeks.

I hope you get sorted, just be sure that they are not treating this as a new loan, at the end of the day it is more valuable to them if you repay the money rather than them to have to go through repossession and higher costs.

engrish?

smelltheglove wrote: »

Ok not exact same position but since my husbands wages took a turn for the worse in the last year we found ourselves struggling to meet repayments on credit cards and loans. We had a period of around 6 months where we literally could not afford to put food on the table and he approached the bank a couple of times about refinancing. Each time declined, he was getting more and more unpaid transaction fees added on to the already mounting debt.

More recently he received a call from teh bank, from the financing department where an employee there was calling to try and help him ease the troubles on his account, apparently when he was going to the bank looking for a refinance they were just treating it as a new loan and declining it, through this person though he was able to arrange exactly what needed to be done, credit card cut up, overdraft and loan and any amount outstanding on the card were all rolled into one refinance option which has almost halfed the repayment.

We were literally shocked when this happened as we had tried and tried again but apparently we just hadnt been put through to the right department when trying to arrange the refinance. This was Bank of Ireland, and when the right guy came to us it was all sorted within 2 weeks.

I hope you get sorted, just be sure that they are not treating this as a new loan, at the end of the day it is more valuable to them if you repay the money rather than them to have to go through repossession and higher costs.

Thanks very much, have written to them again, we'll see what happens.

ilovelamp2000

dudara wrote: »

Did you enter into a Hire Purchase agreement, or is the vehice leased?

You have different rights depending on which arrangement you entered into. There was a recent thread in the Motors forum regarding returning vehicles under the "Half Rule" in a HP agreement.

It's worth mentioning that the rules about the third and half relating to HP agreements are laid out in the Consumer Credit Act and don't apply to business HP agreements.

If it's a commercial vehicle it's likely to be a business HP agreement.

ilovelamp2000

mcaul wrote: »

Very stupid from the bank!

You've made a very reasonable offer and they have refused. If this went to court the judge would rightly give the bank a pasting.

Best option is to call into the office of the finance dept of the bank. (AIB = Sandyford Ind Est, BOI = Pembroke Road. Dublin 4, etc etc.)

Talk face to face with someone, bring supporting documentation and if they don't make a deal with you, then let them know that you'll be returning the vehicle to them.

They will then HAVE accept a reasonable payment proposal from you for setlement of any outstancding debt afetr the vehicle is sold. Only if you don't pay this can they take you to court.

If you still need a vehicle you can do a long term rental with someone like Northgate http://www.northgatevehiclehire.ie/

By doing above, it should not affect credit rating except with the financial institution you are with.

From my experience , if the OP was to do that his credit rating would be affected.

If the OP handed back the vehicle and it was sold leaving a shortfall which he was to pay over a period of time - once the vehicle is sold the remaining amount is noted as a bad debt - this would show on the ICB as a "W" standing for written off. That would remain there until the shortfall is made up.

You'll struggle to obtain finance if you've got a "W" showing up on any previous finance.

mcaul

Rosco1982 wrote: »

From my experience , if the OP was to do that his credit rating would be affected.

If the OP handed back the vehicle and it was sold leaving a shortfall which he was to pay over a period of time - once the vehicle is sold the remaining amount is noted as a bad debt - this would show on the ICB as a "W" standing for written off. That would remain there until the shortfall is made up.

You'll struggle to obtain finance if you've got a "W" showing up on any previous finance.

Usually, it is transferred into a "loan account" so that the HP is paid off in full and the balance is paid in installments as a personal loan.

engrish?

Yay! I wrote the bank explaining as I did above and they are refinancing over 5 years, cuts my repayment by about 40%!

engrish?

Oh, and never buy something you cant afford!

soc

Well done! Just shows that perseverance pays off!

run_Forrest_run

engrish? wrote: »

Oh, and never buy something you cant afford!

easier said than done in fairness.
Do you own a house? If so, what happens if you lose your source of income? Would you be able to make the mortgage repayments?
Basically, even with the best financial planning, sh*t happens.