Skip advert
Advertisement

A third of used cars sold with outstanding finance

Fresh data reveals proportion of second-hand cars sold with finance owed has risen from a quarter to a third

A third of all used cars sold in the UK have outstanding finance, according to new figures.

Six million used vehicles were flagged as having finance still outstanding in 2017 but, in the first quarter of this year, 2,437,025 vehicles raised similar alarms. Assuming that trend continues across the rest of 2018, 9.7 million second-hand cars are likely to be sold this year finance still owed on them.

Advertisement - Article continues below

The figures come from automotive data company cap hpi, which cites the continued growth of personal contract purchase (PCP) deals as fuelling the rise in such sales. Roughly three quarters of new cars are bought using a PCP deal, and cap hpi says a car is considered to have been sold fraudulently “if the vendor tries to sell the vehicle with existing finance still owed, without letting the buyer know.”

Fans of hot hatchbacks and camping are most likely to be caught out, according to cap hpi. Some 48.5 per cent of camper vans had monies still owing in 2017, as did 48.6 per cent of hot hatches.

Taxis (27.2 per cent), vans (29.5 per cent), tractors (30 per cent) and luxury cars (31 per cent) were the least likely class of vehicle to be sold second hand with outstanding finance.

Fernando Garcia, hpi’s consumer head, warned used car buyers they faced “unwitting trouble” if they purchased a second hand car with outstanding finance, as loans stay with vehicles not owners.

Garcia added this meant “most finance agreements or loans will grant the lender ownership of the vehicle until the debt has been paid.” This, he warned said, could lead to the vehicle being repossessed, meaning consumers could lose both the car and the money they paid for it.

Want to check the history of a car you're thinking of buying? Our parent company Carwow has the car history checker tool for the job...

Skip advert
Advertisement

Find a car with the experts

Skip advert
Advertisement

Most Popular

New Kia PV5 Passenger MPV undercuts the VW ID.Buzz by a huge £25k
Kia PV5 Passenger - show front

New Kia PV5 Passenger MPV undercuts the VW ID.Buzz by a huge £25k

New entry into the electric people carrier market undercuts the VW ID. Buzz by a significant margin
News
29 Apr 2025
Ford Fiesta to return? Icon could be reborn as re-nosed Volkswagen ID.2
Ford Fiesta facelift - front cornering

Ford Fiesta to return? Icon could be reborn as re-nosed Volkswagen ID.2

VW’s sales and marketing boss considers Ford tech share “very successful” – and won’t rule out future projects
News
30 Apr 2025
New 2025 Kia PV5 van starts from a tempting £22,645
Kia PV5 Cargo on display at Commercial Vehicle Show - front 3/4

New 2025 Kia PV5 van starts from a tempting £22,645

All-new entry into the van market promises competitive pricing and comes with a range of up to 247 miles
News
30 Apr 2025