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Jo C.
Jo C., Barrister
Category: UK Traffic Law
Satisfied Customers: 70282
Experience:  Over 5 years in practice.
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Hi, Is it possible to clarify the Limitations Act in relation

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Is it possible to clarify the Limitations Act in relation to finance secured on a car?

I know unsecured debts become statute barred after 6 years of no contact from the lender, but what is the situation in relation to car loans secured on the car?

Thanks for your help in advance.

Thank you for your question and welcome to Just Answer. My name is XXXXX XXXXX I will try to help with this.

A loan secured against a car is a contract. It has the same limitation as any other contract which is 6 years.

However, time does not run from the date of contract but the date of last acknowledgment - eg. the last payment or negotiation over payment. Normally time runs from many years after the actual contract date.

Is that all you wanted to know?

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Customer: replied 4 years ago.

Hi Jo,


Just a quick question (hopefully) in relation to my previous question...


For a car loan where the last payment (and contact regarding payment) was 8 years ago, if I contact the loan company to return the vehicle and they say the account is with a debt collector (?) then if I hand the car back, does this count as a payment and does the clock reset?


I don't want to go into details as it is a long a boring story, but I thought everything was settled 8 years ago, I come to sell the car and see they have registered outstanding finance with HPI. I'm not bothered about the money in selling the car, I just want rid of the car, but the amount (I guess with interest and misc. charges over the years they have made up) the amount on HPI is quite sizable.


I don't want to give the car back if I am then liable for this random amount they claim against me, but if I can hand the car back and claim this debt is statute barred, then I will follow that route. They havent communicated this debt or charges, this is the first I am hearing of it!


Many thanks for your help.


Kind regards.


To be wholly honest, I think that would amount to acknowledgement.

It must be said that the don't always act upon acknowledgement but they could.
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