Car finance 'kill switches' immobilise cars if payments are missed

Motorists who fail to keep up with car finance payments can have their cars remotely immobilised to by the finance firms

Van finance explained

Car finance providers are installing 'kill switches' on customer cars that immobilise the vehicle if monthly payments are missed.

The GPS devices are often offered as part of subprime car finance deals to buyers with poor credit scores. The devices allow lenders to remotely disable cars if borrowers fail to keep up with the payments.

The immobilisers are said to be installed behind the dashboard of cars. When drivers make their monthly payments they receive a code to enter into the device via a remote control to keep the car running. If they fail to keep up with payments, the lender will not send the code and the car cannot be started. 

Best car finance deals 

Stoneacre, a finance provider offering such schemes said the kill switch device had cut default rates by 500 per cent. Another firm, Car Finance Company said the device is a handy reminder for owners to keep up with payments. 

The Finance and Leasing Association said immobilisers were “used by a minority of the industry in very limited circumstances. A customer must always be made aware that their vehicle has been fitted with one of these devices – and the circumstances in which it could be used must comply with FCA [Financial Conduct Authority] regulations.” 

Car finance market faces a potential mis-selling scandal

However, whether the devices are legal has been put under question. Graham Hill, a board member at the National Association of Commercial Finance Brokers questioned the legality of vehicle immobilisers.

The Financial Conduct Authority recently launched an investigation into the vehicle finance sector after reports of “irresponsible” lending practices. The FCA has yet to confirm whether immobilisers form a part of its investigation

Would you want an immobiliser as part of your finance deal? Tell us your thoughts in the comments below... 

Recommended

Four million people in the UK have fallen asleep while driving
Tired driver
News

Four million people in the UK have fallen asleep while driving

Research produces worrying revelation that four million UK motorists have nodded off behind the wheel at some point
16 Jun 2021
Thatcham approved devices and crash tests explained
Joe Finnerty in Hyper G sled
Consumer news

Thatcham approved devices and crash tests explained

Thatcham studies crashes, rates alarms and sets insurance groups to help cut drivers’ costs. We find out how
11 May 2021
Company car tax guide 2021/2022: everything you need to know
Executive saloons make popular company cars
Consumer news

Company car tax guide 2021/2022: everything you need to know

Company car tax is bound up in a complex net of emissions, salaries and a car's value; we explain how the system looks for the 2021/22 Financial Year
27 Apr 2021
No new smart motorways to open without stopped vehicle detection
smart motorway
News

No new smart motorways to open without stopped vehicle detection

Implementation of SVD technology to be accelerated, with existing smart motorways getting the system six months earlier than planned
21 Apr 2021

Most Popular

Driving test update to preserve the manual gearbox
Dacia Duster gear lever
News

Driving test update to preserve the manual gearbox

With more drivers learning in autos and electric cars, the DVSA is looking to update the driving test so people can still drive manuals in future
16 Jun 2021
Ineos Grenadier prototype 2022 review
Ineos Grenadier prototype
Ineos Grenadier 4x4

Ineos Grenadier prototype 2022 review

Can the Ineos Grenadier really fill the mud-splattered void left by the old Land Rover Defender? We take a first drive in a prototype to find out...
15 Jun 2021
New 2021 Vauxhall Astra to offer plug-in hybrid power
Vauxhall Astra render
Vauxhall Astra

New 2021 Vauxhall Astra to offer plug-in hybrid power

The new Vauxhall Astra will get a plug-in hybrid powertrain and a more premium image - here’s how it could look
17 Jun 2021
Illegal car modification hotspots revealed
Volkswagen Polo exhaust
News

Illegal car modification hotspots revealed

Gloucestershire has the highest proportion of illegal car modifications, with altered number plates the most common breach
14 Jun 2021
Tesla Model 3 police car all set for evaluation by UK emergency services
Tesla Model 3 police car - front
News

Tesla Model 3 police car all set for evaluation by UK emergency services

Tesla hopes to offer UK police forces a new zero-emission emergency responder option with the Model 3 police car
17 Jun 2021
New Renault Arkana 2021 review
Renault Arkana - front
Renault Arkana

New Renault Arkana 2021 review

Does an eye-catching coupe-SUV body give the new Renault Arkana the edge over other mid-size SUVs? We find out...
16 Jun 2021
New Vauxhall Astra prototype review
Vauxhall Astra prototype - front
Vauxhall Astra

New Vauxhall Astra prototype review

A new Vauxhall Astra is on the way and we've driven a prototype ahead of its official arrival
14 Jun 2021
UN report highlights ethical problems with electric cars
Electric car charging
News

UN report highlights ethical problems with electric cars

Analysis reveals lithium refining takes 65 per cent of Chilean region’s water, while 40,000 child miners dig for cobalt in DRC
14 Jun 2021
New Nissan Qashqai 2021 review
Nissan Qashqai 2021
Nissan Qashqai

New Nissan Qashqai 2021 review

We get behind the wheel of the larger, more comfortable and higher-tech Nissan Qashqai SUV in the UK
16 Jun 2021
New Porsche 911 GT3 Touring tones down the styling
Porsche 911 GT3 Touring - front
Porsche 911

New Porsche 911 GT3 Touring tones down the styling

The optional Touring package aims to bring a few creature comforts to the track-focused Porsche 911 GT3
15 Jun 2021
Dacia unveils new badge design
Dacia badge
Dacia

Dacia unveils new badge design

The new Dacia branding will feature on the company’s cars from 2022, with the Bigster being the first candidate
17 Jun 2021
'I was cynical about Hyundai's aim to be the world's 2nd biggest carmaker, not now'
Opinion Genesis Hyundai Ioniq
Opinion

'I was cynical about Hyundai's aim to be the world's 2nd biggest carmaker, not now'

Steve Fowler is impressed by Hyundai's electric cars, its N division and now its luxury Genesis brand
16 Jun 2021
New SsangYong Korando e-Motion breaks cover with electric power
SsangYong Korando EV
Electric cars

New SsangYong Korando e-Motion breaks cover with electric power

The new SsangYong Korando compact electric SUV will be on sale later in 2021, says the financially stricken South Korean manufacturer
15 Jun 2021
Motorists think they can get away with driving offences due to lack of road police
police speed gun
News

Motorists think they can get away with driving offences due to lack of road police

Lack of road traffic police officers in the UK is making it easy for drivers to break the law, according to a survey of 15,500 British motorists
16 Jun 2021