I purchased a car in July 2011 on a Conditional Sale Agreement. I am considering filing for bankruptcy and would like to know if my car will automatically be taken away from me? I have never defaulted on a monthly payment and the car is, needless to say, in negative equity. The car is currently worth around £6k. It is used every day to get kids to school and husband to work. We pay £175 a month, which I don’t think is considered excessive(??) I am currently pregnant but will be looking for new employment after the baby is born, so having a car available in the future will also open up a lot more employment oportunities for me, as I will have means of travel available. Is it likely that the OR will let us keep the car? Also, is the finance company (Santander Consumer Finance) likely to end the contract and repossess the car purely on the basis that I have gone bankrupt?
Your car is not an asset that can be taken in the bankruptcy, as you still do not officially own it. You would however need to check the terms and conditions of your Conditional Sale Agreement to see whether there is a bankruptcy clause in it. Your agreement may state that should you ever go bankrupt the lender would repossess the car. If this clause does not exist the Official Receiver in bankruptcy may deem it suitable to give you an ‘Income Payment Order’, which may then make the servicing the repayments on the car unaffordable. Please seek further financial advice.
This question has been answered by CAP UK, a leading debt charity offering hope and a solution to anyone in debt.
I had a van that was purchased on finance however i have gave the van, well sold it actually to somebody a couple of months ago although i am still keeping up with the origional payments.
The problem is i intend to apply for bankruptsy this month, how will this affect the new owner? will it be repossesd of them?.
With me selling it to them surely the debt will remain in my name? i dont want it to be repossesed as i cannot afford to pay them back for the vechal?
Please could you afvise me further on this matter.