Van on HP finance

[Dave46049]

If I buy a van on Hire Purchase, the finance company “own” the van until the last payment is made.
How do I stand in making modifications to something I don’t own?

 

[Clipgate]

Quite simply and you seem to have addressed the issue already.

In the majority of cases, for that entire period where you are driving the car but not the registered owner, you are not allowed to modify the car under any circumstances. Some finance providers will allow customers to modify a vehicle, but you must receive consent in order to do so. After consent has been given, and before the customer returns the car, it must be restored to the condition it was in when the finance contract started.

 

[EuroTrotters]

First and foremost, read the terms of your agreement.

99% of people would not even bother worrying.

Just do what you like, within reason.

 

[Jonno1103]

If I buy a van on Hire Purchase, the finance company “own” the van until the last payment is made.
How do I stand in making modifications to something I don’t own?

Quite simply and you seem to have addressed the issue already.

In the majority of cases, for that entire period where you are driving the car but not the registered owner, you are not allowed to modify the car under any circumstances. Some finance providers will allow customers to modify a vehicle, but you must receive consent in order to do so. After consent has been given, and before the customer returns the car, it must be restored to the condition it was in when the finance contract started.

We're not talking PCP or lease, we're talking higher purchase.

 

[Minxy]

Its true with a HP loan on the vehicle you don't own it until the last payment is made however that wouldn't prevent you from modifying it in some way, adding bits etc as all that would likely happen is if you did them badly the value of the MH may go down (more than depreciation) but as you'd have been paying for it anyway if it did go back to them then any shortfall would be down to you to pay, similarly any mods may increase the value a bit so it's swings and roundabouts really.

However I would NEVER buy a MH on HP where the loan is secured on the vehicle, cars yes (if the deal was good like 0%) but otherwise no. The best way to fund a MH purchase is by a personal loan secured on your home as these tend to be a lot cheaper and you own the vehicle from the off as soon as you get it as the loan money could go straight to the dealer or you'd transfer it from your bank account to them. Another way to do it is to get a mortgage instead as the rates are generally a lot cheaper than a loan and again it isn't secured on the vehicle.

The advantage of a personal loan or mortgage to purchase is that in the future if you want to change the MH for a more expensive one you don't have to settle the initial loan as you would with one secured on the vehicle which can prove very costly as in effect end up paying interest on interest not to mention the 'admin' charges for settling early.

So if you have the option to get a personal loan/mortgage instead do that and avoid HP altogether.

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[PP Bear]

Just email and ask. It's better than having an issue further down the hire purchase agreement period.

It'll also depend on the modifications you intend to complete, as they may enhance the value etc.

 

[WESTY66]

Quite simply and you seem to have addressed the issue already.

In the majority of cases, for that entire period where you are driving the car but not the registered owner, you are not allowed to modify the car under any circumstances. Some finance providers will allow customers to modify a vehicle, but you must receive consent in order to do so. After consent has been given, and before the customer returns the car, it must be restored to the condition it was in when the finance contract started.

I dont disagree with the principle of what you’re saying but try telling that to the Harley owners!! Have you ever seen a standard Harley? And around 65-70% are financed, predominantly by Black Horse and Close. I don’t recall one Harley owner asking the finance company’s permission for the loud exhausts and all the chrome goodies they put on.
It’s an interesting question though

 

[Simon Select]

It’s a conditional sale e.g. it’s assumed your keeping it. There is no issue with you doing anything to it.

 

[Wikky]

I would never by a van on hp as it's a luxury and not a neccessity but that's me. I think they are over priced for what they are.

 

[Geistguy]

My understanding with HP is that the lender in effect holds a charge over the vehicle, similar to a mortgage. This gives the lender security should you default, any additions to the vehicle remain yours and can be removed providing the vehicle is not damaged.

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[pappajohn]

I once made the mistake of buying a motorhome on HP.... Or so I thought.
It turned out it was a personal loan from Black Horse finance.
I took it as I was waiting for a property sale and would only be for a couple of months then pay the HP and any accrude interest which is normal for HP.
But no.... The loan had full interest added at the outset and a 1% discount was offered on early payment IN FULL.
My own fault but that mistake cost me almost £20,000 in interest.

 

[Yorick]

We're not talking PCP or lease, we're talking higher purchase.

I'm not being pedantic or rude here, but it's actually HIRE purchase, which is very important when trying to understand it.

 

[Toby28]

It's more likely the insurance company would have the problem. Remember to notify them of anything you do. If you have to claim they will find a way out if you don't disclose modifications.

 

[tribalbrit]

You may also need GAP insurance to. If the vehicle is written off or badly damaged the insurance company may pay out less than the amount you still owe on the Hire Purchase agreement, leaving you with no vehicle, no money and a debt you still have to pay.
Personal loan is the way to go IMO. these can be obtained without securing it against your house.

 

[Otter Spotter]

One good point about buying through HP is that after you have paid 50% of the payments, if you have wrecked it you can give it back irrespective of condition and not have to pay the balance. If you were planning a world trip then then that’s how I would do it.

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[Dave46049]

Thanks for all the info