Don’t Think You Can Pay Your Van Finance? Here’s What You Need To Know

May 10th, 2021

Taking out a van lease is a commitment you have made to the van finance company to pay a pre-agreed set monthly amount towards the cost of your van for a pre-agreed term. Before approving your van finance deal, the funder will have assessed the risk of lending to you by running a credit check and an affordability check to try and ensure that you will be able to pay the proposed amount. However, life isn’t always simple, and changes in situation and circumstance can sometimes mean that you are worried you won’t be able to make your finance payments.

That is why we’ve put together this guide, to offer some tips on saving if you are worried you won’t be able to pay, and what to if you are unable to pay.

How to Cut Costs

We know you’ve probably done your research, and are already keeping costs down with one of the cheapest van lease deals available. However, if you are still concerned that you may not be able to afford your monthly payments, here are some tips on cutting back in other areas.

First, take a look at your business and try and identify the areas that are costing you money. It’s a good idea in any business to have a firm eye on your outgoings. Is there anywhere you could be saving money?

Fuel is a big outgoing cost for any business with a vehicle. Make sure you aren’t spending out on premium fuel unnecessarily, and shop around for the best price before you fuel up. Service stations on the motorway will have much higher prices than you will find at your local garage, so be sure to plan ahead so you’re not overspending on fuel.

Economy: Try and make sure you or whoever is driving your vehicle is driving as economically as possible. This can be as simple as saving fuel by ensuring you accelerate gently and decelerate rather than braking where possible. Rolling in slow traffic, changing up the gears earlier, and cutting down on the electrics in your vehicle when they’re not needed are also good tips for economical driving.

Efficiency: Save more money on fuel costs by ensuring you’re not carrying unnecessary weight when you’re driving around. Try and avoid idling, and plan your journeys to avoid traffic and combine short trips where you can.

Try and cut back in areas of your business where you spend a lot of money. Can you switch to a cheaper supplier? Do you have industry contacts you can use for a lower price? Can you save by going paperless?

Losing the use of your lease van as you could not afford the payments will have a huge impact on your business. So, any changes you can make to cut costs will be worth it if they’re keeping you on the road.

Unable to pay your Van Finance Payments?

You’ve done everything you can, but you simply cannot make your van finance payments. Here is the standard process and some of the dos and don’ts.

Firstly, it’s important to remember that although you currently have possession of the vehicle, until you have made all of the payments it remains the property of your van finance company. If you go into arrears on your vehicle payments it is possible for you vehicle to get repossessed.

If you’re concerned that you will not be able to pay your monthly rental payment, notifying the van finance company is the first step you should take. It may be that they are able to offer you a payment holiday or another option in order to avoid you defaulting on your payments.

If you miss a payment, your lender will be in touch in the form of a reminder. If you continue to miss payments, you are likely to receive a letter notifying you the amount you owe in arrears.

Following this your van finance company can send a default notice, giving you 14 days to clear your arrears. If you are unable to do so, the funder has the option to terminate your agreement and demand the full amount owing and the return of your vehicle.

If you haven’t paid over a third of the total amount for the lease, the funder may repossess the vehicle without a court order. If you have paid over a third of the total van lease cost and they repossess, you may be able to claim debt relief or compensation in court.

For information on cheap van lease deals please Contact Us or call 0117 962 5314.