Your position
Usually, you keep the car. If you bought a car privately, in good faith, and it turns out to have hire purchase owing, the Hire Purchase Act 1964 usually protects you. Contact the lender and get advice.
That protection covers private buyers on hire purchase or conditional sale. It doesn't cover buying from a dealer, or a logbook loan (a bill of sale). On HP and PCP the finance company owns the car until the last payment, and PCP ends with a final balloon payment to keep it. Check before you pay.
- Make sure the V5C shows the seller's name and address, and the VIN matches the car.
- Run a Finance & Stolen Check for £4.99.
- Keep your receipt and the seller's details.
If finance turns up after you've bought the car, contact the finance company straight away. Citizens Advice can help you understand your options.
What to do now
Contact the finance company as soon as you can. If you bought the car privately and in good faith, the Hire Purchase Act 1964 usually protects you, even though finance was still owing. Tell the lender what happened and ask what they need from you. Don't agree to anything until you've had advice.
Keep every record you have. Gather these in one place: - Your receipt or bill of sale - The V5C and the seller's ID - Adverts, texts and emails about the car - Any letters from the finance company - Your check results
The Act doesn't cover dealers or logbook loans (bills of sale), so if either applies, get advice quickly.
Talk to Citizens Advice. It's free and gives impartial advice on your rights. Next time, a Full Check (£9.99) shows finance records before you pay.
Next time
Check finance before you pay. A car can look spotless and still have money owed on it. On hire purchase or PCP, the finance company owns the car until the last payment, and the V5C only shows the registered keeper, not the legal owner. Our Finance & Stolen Check (£4.99) or Full Check (£9.99) shows finance records before you commit.
Do these checks on the day too: - Check the VIN on the car matches the V5C. - Check the name and address on the V5C match the seller's ID. - Ask the seller directly whether anything is still owed.
Be extra careful with dealers and bills of sale. The Hire Purchase Act 1964 usually protects a private buyer who buys in good faith, but it doesn't cover dealers or logbook loans (bills of sale). If you're unsure, speak to Citizens Advice or the lender before you pay. You can run a car finance check any time.