We recently provided an insight into a customer’s rights when it comes to voluntary termination and how they would have the ability to initiate an early exit from a finance plan should the circumstances require such a decision. That being said, there can still be some trepidation on the customer’s part, and not just because it is a significant move to make.
Indeed, there is often concern as to whether a voluntary termination would affect your credit score. The theory would be that, if this has been done for financial reasons, then surely that would negatively impact your credit rating (since a credit score is dictated by the strength of your financial situation). As a result, this could then make it harder to enter a new finance plan down the road, because you would be approaching the negotiations in a weaker position, thanks to your previous voluntary termination.
There would be nothing to worry about, though, because a voluntary termination would not impact your credit score. This is partly because a change in financial circumstances is just one of a number of reasons why a motorist might decide to prematurely leave their vehicle plan. If the decision had nothing to do with cash flow, then it would make no sense for the fall-out to still hinder their credit rating. And since the terms and conditions could not cater for every single scenario, the upshot is that the same philosophy applies in any such situation, ultimately meaning that the two issues –voluntary termination and credit score – would remain separate. In other words, a voluntary termination would not directly impact your credit score in any way whatsoever.
There may be other smaller consequences, however. Amongst those would be a reduced level of trust by your now-former finance company in the event that you wished to enter a brand new deal for a different vehicle. This has the hallmarks of a poor credit situation, because in both cases, the finance company is unsure whether to believe that you could complete all of your required payments on time. But this is linked more to that particular organisation, rather than to your predicament as a whole. They want your business, from the first date to the last, and if that cannot happen, they may not be impressed, but that is something you should not concern yourself with, because there are plenty of other finance companies to consider. That one particular organisation might not give the green light to a different plan, but plenty of others would, and they would not shun you just because of one previous voluntary termination.
So, while there may be some fall-out to a voluntary termination, a negative impact on your credit score would not be one of them. Learn more here www.pcpmissold.co.uk.