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Advice please: Selling a financed car privately?


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#1 Drysdale

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Posted 31 January 2008 - 09:16 AM

Just bought and made the biggest mistake of my life - a brand new 57 plate Mercedes A150 Avantgarde SE (3dr) in silver. Within a month of ownership I've decided it must go. The idea in the first place was that my girlfriend would learn to drive and eventually use the car (it is only group 5 insurance) however she has since decided that driving is not for her.


 So...


The car is fully financed (no deposit) with Mercedes Agility finance. I took a trip down to a VW main dealer who stated the absolute best trade in would be 11k (a loss of 5k in a month...I knew depreciation would be an issue but this shocked me). I originally bought the car for 15k (OTR is 16k but managed to get that down a bit).


The car needs to go but I can't afford that loss. So I've decided to sell privately (even though it is tied to finance) obviously getting whoever is buying to pay off the finance (or if it is lower than what is outstanding I will pay the balance).


 Just really wanting some advice as to the best way to do this (i.e. what to do when it comes to payment etc).


 


Thanks!


 


(Anyone fancy an immaculate, as new, Mercedes A150 Avantgarde SE with 1500 miles?)




#2 richwig83

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Posted 31 January 2008 - 09:32 AM

I doubt you'll get anyone to buy it unless its HPI clear, which it wont be as its under finance at the point of sale!!

 

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Posted 31 January 2008 - 09:38 AM

Yeah i seriously doubt you could sell it. Maybe tell mercedes you cant afford the payments and get the car repossed. I know someone who done this but i dont know how much this cost him or any complications


#4 AidenUK

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Posted 31 January 2008 - 09:50 AM

I think if you get anything repossessed then you will end up with your home address blacklisted and you will have a CCJ against your name? [n] And say if you don't own a house but rent one and then you come to wanting to buy one, the mortgage lenders won't want to loan you any money on a half decent interest rate, same goes for personal loans with banks etc. Chances are they won't give you anything at all.


What i would suggest is getting a loan for the amount of the car finance and then pay the finance off and try to sell it that way? This way you will have a personal loan in your name but the HPI check will show the car as clear. 


People will buy cars which have outstanding finance on them but i should imagine these people will be few and far between because theres a bit of a risk for the buyer to get ripped off.


Don't get the car repossessed because this could potentially make your life very hard for the future.



#5 damianmkv

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Posted 31 January 2008 - 10:13 AM

can't you take it back to MB and say that you no longer want the car ? The will then give you an amount to clear the finance ( taking the car's value into account ) and bob's your uncle. Atleast you won't be paying VW a profirt margin
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#6 AidenUK

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Posted 31 January 2008 - 10:19 AM

can't you take it back to MB and say that you no longer want the car ? The will then give you an amount to clear the finance ( taking the car's value into account ) and bob's your uncle. Atleast you won't be paying VW a profirt margin


I thought finance was a legally binding contract so you had to pay what you signed for. You can only hand the car back if you have paid over half of the amount of finance can't you?



#7 damianmkv

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Posted 31 January 2008 - 10:28 AM

really ? maybe..in that case, bob's no longer your uncle
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#8 BlackMagic20vt

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Posted 31 January 2008 - 10:33 AM

Only a few option really try and sell it to MB who you bought it off and accept that you will have to pay the depreciation around 3k I would have thought..  Or get a loan pay it off and sell it privatley..


 


Failing that throw it off a cliff and play dump to the insurance......lol...


only kidding...Dont try that one unless you want to be someone's b**ch for 6 months if you get caught lol...



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Posted 31 January 2008 - 10:47 AM

Damians solution is the best I think.

Take it to Mercedes, they'll probably give you most in a straight sale as they can sell it on easily.
There will be virtually no prep costs fro them if it's a month old so you want to taget losing the VAT element only.
This works out about £12,500 so still better than the VW figure.

You outstanding finance will be the capital plus a 2-3 months interest at most (they're not legally allowed to charge more).

You'll need to pay the difference between the Merc figure and the outstanding finance by some other means.

 



#10 eyeamsparticus

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Posted 31 January 2008 - 11:03 AM

can't you take it back to MB and say that you no longer want the car ? The will then give you an amount to clear the finance ( taking the car's value into account ) and bob's your uncle. Atleast you won't be paying VW a profirt margin


If you do this I think you'll find a slight problem... Mercedes don't want the car. They can't sell them. The salesmen will still be doubled up in laughter at someone buying their car in the first place.


Drysdale: Sorry to be the profit of doom and gloom but there's an even bigger problem - you paid way over the odds for that car in the first place. If you'd done your homework then the depreciation on an A Class shouldn't have shocked you. It's also the 3dr which nobody wants and if it's not the auto model, you're in even bigger pooh. I can speak with some authority on this - I did exactly the same myself, the only difference was I bought the Special Edition A150, but it was a pre reg with 50 miles on the clock with a few grand off + and extra grand onto my trade-in (if you push hard enough, Merc will give great deals on the A-Class because they can't sell them for love nor money). I lost approx £1500 on the motor so all in all, I would have lost £4500 on that car if I had paid the full list. £4500 after 6 months on a £13K car!


I actually managed 4 months with mine - I thought it was a great car for what it was, but gave up on it only because the suspension was killing my back. It's o.k. around town but on the motorway, despite having the comfort pack, I simply couldn't drive the car for any distance. I couldn't drive the damn thing so I had no option but to sell it.


The only advise I can give is NOT to sell your car private unless you find someone who's doesn't know what they're buying into. You need to do a lot of phoning around, and need to be a little flexible in the choice of car you want, but eventually you'll come across a dealer who'll need to sell their car for one reason or another.


But you'll need to be prepared to loose lots of money. A trade value of 11k is actually quite reasonable considering. Purchasing a popular car that isn't being heavily discounted by the dealers and there's a chance you'll take couple of grand hit. Purchase an unpopular car in the wrong spec from a manufacturer who heavily discounts the car and you've no chance. Either keep the car or be prepared for the worse.


You can purchase an '07 07 plate with similar miles at a Merc dealer for £12k. You can purchase a 5dr '07 57 plate at a merc dealer for 13k (take off £1000 for the 3dr). If I were to go to a Merc dealer without a trade-in, they'd drole if I were to offer them around 11k for your car.


I guess it comes down to: you either take the massive loss right now or take an even bigger loss later on... [:'(] 


Or keep it....



#11 Mikedav

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Posted 31 January 2008 - 11:32 AM

The amount of misinformation on this thread RE selling financed cars is mind blowing. I've said it many times and I will say it again: IT IS NOT A PROBLEM. It's more complex, but I have done it multiple times and am doing it again on another car. I sold my M3 for £25k, and that was mainly on finance.

1: Selling on Finance

2: Selling on Finance

3: Selling on Finance (If you read one, read this one)

4: Buying on Finance

Your issue is is selling so close to the start date as you ARE going to lose some on it. [:(]

Trading it to a garage is the quick but very expensive way of dealing with the problem...if you have time, go the private route. It may be the 'wrong' car as Spartacus says - but thankfully not everyone is as clued up or even cares. Traders will screw you down, but thats their job.

I sold my M3 privately - it needed an Inspection 2 (£1200), a warranty (£1050), rear tyres (£500), front brakes (£700) and alloy wheel refurbishment. I got a little above book within a few days...if he had done his homework, he would know although a nice example mine had £3k+ of work to do. However, if on Autotrader your car is surrounded by similar examples for £12k, thats what its going to be...you may need to hang onto it for a while to even out the depreciation. Is it that bad? Also the market is very quiet at the moment I am told...

EDIT: Could be worse! Z4M Roadster buyers who paid £46k for their cars in 2006 found they were worth £30k trade one year later... [:P] 



#12 BoraDave

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Posted 31 January 2008 - 11:54 AM

Don't get the car repossessed because this could potentially make your life very hard for the future.

The most import bit of information on this thread!!!!
 



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Posted 31 January 2008 - 12:59 PM

On a previous financed vehicle I did the following:



  • obtain settlement figure from finance co.

  • get a loan (www.moneysupermarket.com)

  • clear finance and obtain proof in writing

  • advertise car (check www.parkers.co.uk for current value and MB dealers standard price/offers)

  • buyer pays cash/bankers draft

  • obtain settlement figure from bank on loan

  • pay off (if you have enough), if not spread the balance over 1-2yrs at tiny payments per month or dip into savings and clear off completely

 


On my last financed vehicle (3 months ago), I did the following:



  • obtain settlement figure from finance co.

  • advertise as financed but buyer to pay finance co. directly on day of sale over the phone with card (you both know you're not diddled)

  • luckily the person who bought my car hadn't done much research and overpaid me by £2k on the car, so got the balance in cash which went towards my next vehicle

  • sent the receipt from the finance co. on to the buyer 1wk later

I was however told by someone at work that legally I wasn't allowed to sell the car whilst financed but my mates do it all the time.


DO NOT MISS PAYMENTS ON YOUR CURRENT AGREEMENT OR LET IT GET REPO'D, OTHERWISE YOU'LL GET POOR CREDIT SCORING WHICH STAYS ON YOUR CREDIT FILE FOR 6YRS!!!



#14 willydog

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Posted 31 January 2008 - 01:21 PM

there should be a clause in your contract that allow you to hand back the car and owe nothing more on it provided you have made meet the minimum no of payments.  it might be worth going down this route if its cheaper than being hit with £5k depreciation.


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Posted 31 January 2008 - 02:09 PM

The amount of misinformation on this thread RE selling financed cars is mind blowing. I've said it many times and I will say it again: IT IS NOT A PROBLEM. It's more complex, but I have done it multiple times and am doing it again on another car. I sold my M3 for £25k, and that was mainly on finance.

1: Selling on Finance

2: Selling on Finance

3: Selling on Finance (If you read one, read this one)

4: Buying on Finance

Your issue is is selling so close to the start date as you ARE going to lose some on it. [:(]

Trading it to a garage is the quick but very expensive way of dealing with the problem...if you have time, go the private route. It may be the 'wrong' car as Spartacus says - but thankfully not everyone is as clued up or even cares. Traders will screw you down, but thats their job.

I sold my M3 privately - it needed an Inspection 2 (£1200), a warranty (£1050), rear tyres (£500), front brakes (£700) and alloy wheel refurbishment. I got a little above book within a few days...if he had done his homework, he would know although a nice example mine had £3k+ of work to do. However, if on Autotrader your car is surrounded by similar examples for £12k, thats what its going to be...you may need to hang onto it for a while to even out the depreciation. Is it that bad? Also the market is very quiet at the moment I am told...

EDIT: Could be worse! Z4M Roadster buyers who paid £46k for their cars in 2006 found they were worth £30k trade one year later... [:P]

Mik is the only one speaking any sense here... all others saying you CANNOT sell a car on finance are lunatics.. TBH if I was buying I would be more worried if a £20k plus car DIDNT have fincne...

 

All you do is get a settelment figure of the FInance CO and get the purchaser to pay the fincne company direct... easy 



#16 AidenUK

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Posted 31 January 2008 - 05:14 PM


The amount of misinformation on this thread RE selling financed cars is mind blowing. I've said it many times and I will say it again: IT IS NOT A PROBLEM. It's more complex, but I have done it multiple times and am doing it again on another car. I sold my M3 for £25k, and that was mainly on finance.


1: Selling on Finance


2: Selling on Finance


3: Selling on Finance (If you read one, read this one)


4: Buying on Finance


Your issue is is selling so close to the start date as you ARE going to lose some on it. [:(]


Trading it to a garage is the quick but very expensive way of dealing with the problem...if you have time, go the private route. It may be the 'wrong' car as Spartacus says - but thankfully not everyone is as clued up or even cares. Traders will screw you down, but thats their job.


I sold my M3 privately - it needed an Inspection 2 (£1200), a warranty (£1050), rear tyres (£500), front brakes (£700) and alloy wheel refurbishment. I got a little above book within a few days...if he had done his homework, he would know although a nice example mine had £3k+ of work to do. However, if on Autotrader your car is surrounded by similar examples for £12k, thats what its going to be...you may need to hang onto it for a while to even out the depreciation. Is it that bad? Also the market is very quiet at the moment I am told...


EDIT: Could be worse! Z4M Roadster buyers who paid £46k for their cars in 2006 found they were worth £30k trade one year later... [:P]



Mik is the only one speaking any sense here... all others saying you CANNOT sell a car on finance are lunatics.. TBH if I was buying I would be more worried if a £20k plus car DIDNT have fincne...


 


All you do is get a settelment figure of the FInance CO and get the purchaser to pay the fincne company direct... easy 



I said above that you can sell a car on finance but the facts are that most people will not entertain buying a car which has outstanding finance. I wouldn't have a problem with buying a car with outstanding finance providing the full amount had been settled before i took ownership of the car.



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Posted 31 January 2008 - 05:33 PM

I bought my Golf from someone who had it on finance... it was easy peasy..

we got it HPI checked to make sure the only issue that would come up was the finance,
then got the RAC to go look it over, one we were happy with the car and seller integrity we
drove up to meet the guy, went back to his house.. i sat down at his kitchen table, rang the
company with whom the finance was outstanding.. paid it off by card, he signed over the car and
away i went!

The key really is to get them to ring the finance company and give them clearance to discuss the
matter with you, then you can talk to them about the best/safest way to settle it.

ps. i did block him in on his driveway though lol.. dunno what good it would have done but i felt better!


#18 eyeamsparticus

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Posted 31 January 2008 - 06:22 PM

I think you guys are all missing the point. Selling that A150 privately with or without finance is going to be nigh on impossible unless the price is dropped. The fact is nobody wants a 3dr A-Class, and if they did they'd go to a Merc dealership. Many of the W169's sold in the UK are actually bought by main dealers from Mercedes at closed auction. The main dealers not only advertise their cars thru their dealerships, they also advertise their A Class's thru Autotrader and some of them use Ebay... You really don't stand a chance of selling your car at a decent price.


I've seen some dealers advertise their low miles cars for months on end at substantial savings from new, and they still don't sell, so the chances of getting a quick sale are very slim indeed. Now take into account the depreciation and that Mercedes are face-lifting the W169 in August and that can only be further bad news.


DRYSDALE - If I remember correctly, the best price I got for my A150 was from the Mercedes direct network of dealers. These guys differ in that they only sell second-hand Mercs - mainly those rejected by the main dealerships. They were actually looking for late low mileage examples when i was selling - I guess they couldn't compete on price with the main dealerships at the Mercedes closed auctions. If you go to www.directmercedes.co.uk give a few of their dealers a try. Never know, they might be interested in buying your car.



#19 Mikedav

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Posted 31 January 2008 - 08:47 PM

 

I said above that you can sell a car on finance but the facts are that most people will not entertain buying a car which has outstanding finance. I wouldn't have a problem with buying a car with outstanding finance providing the full amount had been settled before i took ownership of the car.

Why?

Around 80% of cars above £10k on the road are financed. Cash purchases are very, very rare these days.

When you trade a car in at a dealer, they pay off your finance for you.

You pay the finance company direct - thus the full amount has been settled before you take ownership of the car.

To me this is a bit like saying you won't buy someone's house unless they have cleared the mortgage first.







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