Can I sell an inherited car on finance?
Yes, you can sell a car on PCP or HP finance after a bereavement, but there are additional steps to follow.
- Note: Personal loans are not considered legitimate vehicle finance and should be managed separately as part of the estate. For leased vehicles, you must pay the lease company and obtain a V5C in your name before selling.
Steps to Follow:
Contact the Finance Company:
- Inform them of the registered keeper's death.
- Notify them of your intention to sell the car to a dealer.
- Provide a death certificate and proof of inheritance (e.g., will or probate document).
- Requirements may vary, so the finance company will guide you through their specific process.
Discuss Your Options:
- You can request an up-to-date settlement letter for the dealership to pay off the agreement.
- Transfer the finance agreement into your name to continue making payments.
- Settle the finance agreement yourself.
- It’s advisable to get a settlement figure, as dealers typically pay the finance company directly. This can be done even if the finance is already in your name and you're making payments.
- If you recently settled the finance yourself, provide a letter from the finance company as proof.
Request a Settlement Letter:
- Your finance provider must send a settlement letter within 12 days of your request, which usually arrives in 1-3 working days.
- Settlement letters are valid for only 10 days, so it’s best to sell the car as soon as you receive it. If it expires, you can request a new one.
- Upload or email the letter in its original format (usually PDF). Screenshots or forwarded emails are not accepted.
Understanding Equity:
- Positive Equity: If the car sells for more than the amount owed, the dealer will use the proceeds to clear the finance and pay you the surplus.
- Negative Equity: If the sale price is lower than the amount owed, you can still sell the financed car, but you'll need to pay the difference to the dealer before they settle the total balance with the lender.