Alright guys just a quick question i got my car last year on finance i done a credit check on myself today and when i looked in my accounts etc the finance i got on the car says personal loan?? i thought finance was hp as all my previous financed cars were ??i have hpi'd the car and it says personal loan i was just wondering what the difference was between hp and a personal loan

many thanks

 

Hire.Purchase;
YOU don't own the car till YOU'VE made all the repayments, loan is secured against the car.
Loan company can reposess.

Any other loan, YOU own the car immediately, loan is secured against you.
Loan company can't normaly reposess.
.

 

Normally with HP, you won't be able to sell the car on until you've paid off all the finance. Personal loans on cars mean you should be able to sell the car on - but check your HPI report carefully, as some unscrupulous lenders place a marker stating that the vehicle is still subject to finance.

If that's the case, keep on at the company until they remove it.

 

What Focus V8 said.

Hire purchace is finance registered against the car, therefore you dont own the car until you have paid it off

Personal loan is finance registered against you not the item purchased.

 

ahh right i dont get how they can put it on the hpi list if its not hp??

 

FROM HPI;

Personal Loan

The lender has no claim on or interest in the vehicle but has registered the existence of a personal loan as part of the Governments Responsible Lending drive. If you are concerned because the vehicle you are looking at has this type of finance, you should seek clarification from the lender and the seller of the vehicle.

 

ahhh right cheers for that matey still cant sell it then as i think that would put buyers off i know it would if it was me boo i got excited when i saw personal loan lol thank u all for clearing that up for me

 

Just out of interest mate who did you do your credit check with as im looking to do one on myself.

 

i think you will find its a personal loan secured against the car so you cant sell it until its paid off and you lose your right to hand it back half way through your agreement.

 

equifax matey

 

Cheers bud

 

Credit reports are a fickle thing, as far as the credit report is concerned it is a personal loan. Because, well its a loan to you.

However you have your standard unsecured personal loan. Which most banks will give your. Or Hire Purchase, where the loan is secured against the asset you have bought.

So as said above, you don't own your car until you have paid back the loan. It it still the property of the finance company.

 

Go into natwest, pick up a credit scoring leaflet from them, tear out the back page, send it to experian and include a cheque for Ł2.

If you buy it off the website your going to pay Ł12 for a download-able one

 

Yes, you can. The loan is not secured against the vehicle and it's not correct that the finance company have placed that marker against that vehicle, remember:

"The Lender has no claim or interest in the vehicle"

If that's the case, why is the marker applied?

I've challenged this myself before, and there is no legal rule for the company to prevent you selling the car. You are bound by the terms and conditions of your agreement and if it says personal loan, with no reference to paying the full amount back before you own the car, then you can do what you like with the vehicle.

Of course, you'll still be responsible for the loan, that won't go away even if you sell the car.

 

Not totally true.

Remember the finance is secured against that asset, you have an obligation to

i) Retain the vehicle until the finance is repaid or
ii) Repay any outstanding finance on the sale of that vehicle if it is sold to a third party.

Yes you are still personally liable for the debt, but it means if you have sold it they will expect you to cough up the cash immediately or they will take you to court to get the money back.

 

A personal loan is just that, a loan to the person, not secured against anything specific.

However if the car has a marker against it then, the lender of the money must have been told the registration by the current car owner.

That would suggest knowing the reg. may have been a condition of the loan.
So either the loan is not truly a personal one and may be secured against the car, or the loan is H.P and has been both mis-sold and mis-marked as a personal loan.

A question to the source of the loan to clear up exactly what type it is would seem the best option.

.

 

Mad Mac - for once we will have to disagree on a financing question but I specialised in this kind of lending for over 6 years and can CATEGORICALLY state that a personal loan puts no link between the provision of finance and the asset.

If the OP really has signed a Personal Loan Agreement he is free to sell the car at any time, but is obliged to continue the repayments until it is repaid in full, and he has no right to return the asset and walk away under HPs half/third rule. (He needs to check the original document because the finance type on HPI could simply be an input clerk entering the wrong code).

As posted by FocusV8 above, the finance is disclosed on HPI to make other potential lenders aware that the OP has this outstanding debt, and help minimise the risk that he ends up with multiple loans for cars that are sold on and turned to cash with no means of then servicing the debts, or assets that can be repossessed, but there is no reason why a potential purchaser should be put off by this as they will have clear title to the asset.

 

Absolutely correct.