What happens when a customer rejects their financed vehicle?
20 June 2023
By Joy Pearson
When it comes to car finance, choosing the perfect vehicle is an exciting yet important decision, for everyone. But what if, after signing the dotted line of your new finance agreement, you find yourself having second thoughts about the vehicle? In today's post, we'll explore what happens if you decide to reject a vehicle after the finance agreement has been put in place so that if you come across this situation in the future, you know what options are available to you.
In certain situations, car finance agreements may include a 'cooling-off' period. This period provided you with a window of time after signing the agreement to change your mind and cancel without facing significant penalties. It acts as a safety net for buyers who may have second thoughts after signing the agreement. The duration of the cooling-off period can vary depending on the specific terms and conditions of your agreement. It's crucial to carefully review your agreement to determine the length of this window. If you decide to cancel within the cooling-off period, you should get in touch your with finance provider as soon as possible so that you stay within the cooling-off period and can cancel the agreement without having to pay any additional fees.
If the cooling-off period has passed, rejecting the vehicle usually involves terminating the finance agreement early. Early termination may come with financial consequences that you need to consider. These consequences often include penalties or fees that you'll be responsible for paying. The specific amount and calculation method for these penalties or fees can vary depending on your agreement. It's essential to review your finance agreement thoroughly to understand the potential costs involved in terminating the agreement early.
If you've missed the cooling-off period or early termination is necessary, you may need to explore options for disposing of the vehicle. One option is to return the vehicle to the finance provider or dealership. However, this options if subject to specific conditions set by the finance provider, such as mileage restrictions and maintaining the vehicle's condition. It's important to communicate with the finance provider or dealership to understand the procedures and requirements for selling or returning the vehicle.
It's crucial to note that rejecting the vehicle does not automatically absolve you from your financial obligations under the finance agreement. Even if you choose to return the vehicle, you may still be responsible for paying any outstanding balance, including fees, penalties, or depreciation costs associated with returning the vehicle. To fully understand your obligations, review the terms and conditions carefully and consult with your finance provider or dealership. They can provide specific information tailored to your situation and help you navigate your financial responsibilities effectively.
By considering these factors and understanding the details of your finance agreement, you can make informed decisions if you need to reject the vehicle after the finance agreement has been put in place. It's essential to communicate with the finance provider or dealership to ensure a smooth process and mitigate any potential financial implications.