Can You Scrap A Vehicle With Outstanding Finance?

It is against the law to scrap a vehicle that has finance owing to it. Be it a roadworthy vehicle or a scrapped vehicle, the owing finance must be paid legally to scrap the vehicle in a scrapyard. It is because you do not entirely own the car until and unless you pay back the debt. Hence an outstanding finance check will help you to know if the vehicle has any pending debt on it or not. 

Is It Illegal To Sell A Vehicle With Finance Owing To It?  

Yes, it is unlawful to sell a vehicle with finance untold by the seller. However, you can still sell a car with finance, but you have to inform the buyer about the pending debt on the vehicle. If the buyer still wants to get the vehicle with the finance, he has to take some legal actions with the finance company and own the vehicle after settling the pending payment.

However, it is a risk factor to get a finance vehicle. Thus it is essential to check outstanding finance on the car before buying any used vehicle.

How To Check If The Car Is On Finance?

1. You can contact the previous owner of the vehicle to know the financial status of the vehicle.

2. It is always the best option to go for a full vehicle check that discloses the complete history of the vehicle. Through the premium check of car analytics, you will know if the vehicle has outstanding finance or not and the type of agreement with the finance company. 

Which Is Better, Car Finance Or Loan?

Choosing your next car, what is your option? Personal loan or hire purchase. Before that know what, it is,

• Hire purchase is one of the ways to finance a new or used vehicle. It requires you to deposit upfront and pay off in monthly instalments. The ownership is with the finance company until you settle the final payments.

• A personal loan is another type of finance deal where you get a loan from the bank or finance provider when your credit rating is good. Ensure you have secured the loan against your home because putting your home at risk isn’t a good option when you fail to repay. 

Who will own the car? If you take a hire purchase, you can hold the car once you settle the debts, whereas the personal loan will help you own the car as soon as you purchase. 

Though both financial deals are great according to their affordability but the higher risk in the hire purchase, you can’t sell or own the vehicle until you pay for it. It is also expensive compared to a personal loan.

Why Do Buyers Need To Check If The Car Is On Finance?

The finance cars aren’t a good option as they cost you double the amount you choose to pay for a used car since you need to pay for the car and settle the unpaid debts. 

If you know about the financed car before buying, confirm it with the seller and ask to settle the debts beforehand. If you wish to pay the remaining debts, speak to the financier and seller about the settlement figures.

It is not recommended to buy the financed vehicle, but it is completely your choice to proceed with. Because the risk of buying a car with finance will lose the vehicle if you failed to repay and can’t enjoy the car ownership, so it’s better to buy the issue-free used car, ensure the seller doesn’t hide the potential issues. You can confirm it with the online outstanding finance check.