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Car Finance Advice

The world of car finance is a tangled web, make sure you're doing the right thing should you encounter any problems.

Our simple 'Car Finance Advice' page explains how to handle your car finance should you encounter problems when your vehicle is stolen or written off.

My car has been stolen, what should I do?

Let people know

If you are unfortunate enough to walk outside to where your car was parked and you’re faced with an empty space, don’t panic! First things first, ensure that a spouse, relative, etc has not taken the car unexpectedly, they may have just popped down to the shops.

If you’re sure your car has been stolen, contact the police immediately and then your insurance company. Notify the police via their 101 phone number (not 999 unless it’s an emergency) and ask to speak to your local station. Provide them with all the information you have about the car including make, model, registration, colour and any identifying modifications such as spoilers, wheels, etc.

The police will issue a crime report number which you will need to pass onto your insurance company and finance provider, so ensure you keep a note of it. Don’t worry about the DVLA as the police will notify them of the stolen vehicle and also if it is later recovered.

Telling your insurance company

Speak to your insurance provider as soon as possible, they may take up to 3 months to settle any claim so the sooner you start the process, the better.

The insurance company should pay out ‘market value’ for the vehicle, i.e. what you would have realistically received if you decided to sell the car. If the valuation they provide is below what you believe to be ‘market value’ you can contest their decision.

If you receive a settlement payment, you should call the DVLA and let them know that you’ve been paid out. To do this you need to fill in a V5C/3 form, which is a ‘notification of sale or transfer’ part of your V5C registration document. Along with this, you’ll also need to send a letter stating when you were paid out, how much you were paid and the name of your insurance company. Then you need to send the rest of your V5C to your insurance company. If you don’t have the V5 document because you were asked to send it to your insurance company and you’ve already done that, it’s okay, just inform the DVLA. Write a letter including your insurance company’s details, the date of your claim, your registration number, make, model and colour.

Tell your finance company

Last but not least it’s time to inform your finance provider about your vehicle being stolen. Pass on all the same information provided to the insurance company along with the crime reference number you were given by the police.

You will have to continue paying your finance instalments while your claim is worked by the insurance company. If your car is later found and returned to you, you’ll need to get a letter from your insurance company confirming this.

If the insurance company pays you out, you must use this money to settle the balance owing on your finance agreement. Once that’s done, your agreement is finished and you’re free to start a whole new agreement for a new car.

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Can I sell my car if I’m still repaying the finance on it?

You DO NOT need to wait until the end of a finance agreement to sell your car and buy another. It is however, illegal to knowingly sell someone a car with outstanding finance without informing them of the situation.

If you are selling a car with finance still outstanding there are two things you must do before you can legally sell it:

Inform the finance company and ask them for the “settlement figure” they’ll need from you to pay off your loan in full.

Pay off the settlement figure, plus any early repayment fee and administration fee the lender might charge.

The finance company will have registered your car on the HPI and Experian databases when you took out the finance agreement. Before buying a used car, dealers and most sensible private buyers check these databases to make sure there’s no finance outstanding on it.

My car is written off and I’m still paying finance?

Don’t panic

Driving along, minding your own business and then…smash….someone crashes into you. If you arranged finance to buy the car, where does this leave you and what can you do about it? First of all, don’t panic – cars can be repaired or replaced, hopefully nobody has been injured.

What is an insurance write off?
There are two basic kinds of written off vehicles. Firstly categories A and B mean that the vehicle has sustained significant damage, enough to make it unsafe to repair and return to the public roads.

The second type of write off (categories C and D) can be for financial reasons, where the cost of repairing the vehicle out-weighs the market value of the vehicle. For example, if your car has a market value of £3,000, is involved in an accident and the repair bill is estimated to be £5,000, your car is likely to be written off by the insurance company.

Do I need to continue making monthly finance repayments if my car is written off?

The short answer is YES. It may seem a little unfair that your car has been involved in an accident and the insurance company are taking their time to assess the situation, but you still have a finance agreement and you must continue making your regular monthly repayments. It may seem very tempting to stop paying for something you’re unable to drive but please ensure you maintain your regular payments. If you stop payments the finance company will pursue you and it is likely to result in your credit history showing defaults which you certainly want to avoid. You will then find it difficult or expensive to gain credit in the future.

What should I do when my car is written off?

Once you know the insurance company is going to write off your car and you’ve got a settlement figure, call your finance company and speak to them. You will need to use this money to settle the outstanding finance on your agreement.

There is a chance that the insurance company will allow you to buy the car back from them, allowing you to complete repairs at your own expense. Be aware that your finance provider may not wish to finance a written off car so don’t presume you can keep your current agreement running. Certainly ask the finance company of their policies regarding write offs or look for specialist finance providers who would be happy to assist (www.thecarloanwarehouse.com/finance-cat-c-cat-d-write-off/).

Spread The Cost

Spread The Cost

Monthly Payment £0
Total Repayable £0
(7.9% APR illustration)
Apply Now
Rates may vary depending on loan amount and individual circumstances. Subject to status.