Car Finance Settlements Explained 🔍

Marsh Finance offers two main types of car finance agreements: Hire Purchase (HP) and Personal Contract Purchase (PCP).

• HP (Hire Purchase): With HP, you borrow money to buy a car and own it outright once all the repayments are complete.
• PCP (Personal Contract Purchase): With PCP, you make monthly payments to spread the cost of the car. At the end of the agreement, you have the option to purchase the car for a final balloon payment, return the car, or use the equity to put towards a new car.

There are several reasons why you might consider settling your car finance agreement early:

• Upgrading to a new car: If you find yourself wanting a newer car, settling your current finance allows you to sell the car or trade it in as a deposit towards a new one.
• Changing your financial situation: If your financial circumstances improve, you might choose to settle the loan to free up monthly payments in your budget.
• Selling your car: If you decide to sell your car privately, settling the finance beforehand gives you a clear title to sell.

There can be a few potential drawbacks to consider:

• Early settlement fees: Some lenders, including Marsh Finance, may charge an early settlement fee to compensate for the interest they would have earned on the remaining loan term.
• Loss of guaranteed minimum future value (GMFV) option (PCP only): With PCP (Personal Contract Purchase) agreements, the final balloon payment is based on an estimated Guaranteed Minimum Future Value (GMFV) of the car at the end of the term. Settling early might mean you don't benefit from any potential increase in the car's value.

To get the exact settlement figure, you'll need to contact Marsh Finance directly. We can provide a breakdown of the remaining balance, accrued interest, and any applicable early settlement fees.

Ready to pay off your Marsh Finance car loan early? Awesome! To find out the final amount you owe, just fill out our online form.

Ending your loan early shouldn't negatively impact your credit score. As long as you've made all your repayments on time up to that point, settling the agreement early can actually demonstrate good financial management.

It ultimately depends on the type of car finance agreement that you have. See below for a breakdown:

• Hire Purchase (HP): Once you settle the full amount with Marsh Finance, you will become the sole owner of the car, and the vehicle title will be transferred to you.
• Personal Contract Purchase (PCP): Upon full settlement, you will have the option to purchase the car for the final balloon payment outlined in your PCP agreement. If you choose not to purchase, you will need to return the car to Marsh Finance.

If you're having difficulty making your monthly repayments, it's important to contact Marsh Finance as soon as possible.

We can discuss alternative options, such as payment extensions or adjustments to your repayment plan. Check out our help with money worries page for more information.

There isn't a strict deadline to settle your agreement, but the settlement amount provided will have an expiry date. This is because the amount you pay can change due to accruing interest, or paying off more of your loan.

Once you've settled the agreement, Marsh Finance will typically send you a confirmation letter stating the account is closed and in good standing. You might also receive a letter of ownership (V5C) if you have a Hire Purchase (HP) agreement.

The processing time for settlements can vary depending on the chosen payment method. Bank transfers might take a few days to clear, while debit card payments might be processed instantly.