How do I end my current finance agreement?

I would like to end my current car finance agreement. How do I go about it?

The answer to this question varies depending on where you are in your current agreement.

All car finance agreements have a right of withdrawal, better known as a ‘cooling-off period’, where you can withdraw from the agreement within 14 days. You will still need to pay off any credit and interest accrued within 14 days. It should be highlighted that although you can end your finance agreement early under the 14-day cooling-off period doesn’t automatically mean you have ended your agreement to purchase the car. You will need to confirm this with the dealership.

If you are past the 14-day cooling-off period and wish to end your agreement, you will need to settle the finance. The first step is to contact the finance provider for a settlement figure. This is the total amount outstanding, including any interest that you have left to pay. Your settlement figure will need to be paid off in full before the agreement is officially ended.

There is another option available, if you have paid at least 50% of your agreement you can do what’s known as a Voluntary Termination. This is where you hand the car back to the finance company, as a result, terminating your agreement. A voluntary termination will not affect your credit score, you are simply exercising your legal right and therefore there is no negative impact on your credit score.

Justin Cottrell

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