Guides › Debt and Buy Now Pay Later › Hand Back a Financed Car Halfway: Voluntary Termination
Hand Back a Financed Car Halfway: Voluntary Termination
If your car is on hire purchase, you can return it early once you have paid at least half of its cost; on PCP, once you have paid half or made up the difference. This is called voluntary termination, a right under the Consumer Credit Act 1974. You may be charged for damage beyond fair wear and tear.
At a Glance
Your Rights
What the rules say, with a link to the official source for each.
Voluntary Termination
How It Works
With hire purchase you can return the car early if you have already paid at least half of its cost. With PCP you can return it once you have paid half, or make up the difference. Paying more than half earns no refund. This right comes from the Consumer Credit Act 1974. source
Condition and Credit
General wear and tear is acceptable, but you will be charged for repairs such as broken wing mirrors or larger scratches. Voluntary termination appears on your credit file without a reason and makes little or no difference to your score. To keep the car instead, ask for a settlement figure. source
Time Limits to Know
Miss a deadline and you can lose a right. Check the dates on your own paperwork.
- 8 weeksFinancial Ombudsman complaintsLender has 8 weeks for most complaints, then you have 6 months from the final response
Steps to Take
Step 1 of 5
Ask the lender for a statement showing the total amount payable and what you have paid.
Step 2 of 5
If you have paid half, write to the lender saying you are ending the agreement under the Consumer Credit Act 1974. We do not take insurance or banking complaints as cases, but our free letter templates can help you write to the firm.
Step 3 of 5
Fix small damage first if it is cheaper than the lender's charge.
Step 4 of 5
Take dated photos when you hand the car back.
Step 5 of 5
If the lender refuses, complain, then go to the Financial Ombudsman Service.
(Tap the numbers to reveal steps)
Where to Go If It Is Not Put Right
Your options, in order, and when each one applies.
Your Lender's Complaints Team
Always start here, in writing, and ask it to put things right.
Financial Ombudsman Service
After 8 weeks with no final response, or if you are unhappy with it. Refer within 6 months of the final response.
MoneyHelper Debt Advice
You are struggling with debt. Use the Debt Advice Locator to find free local advice.
Good to Know
Small things that make your complaint stronger.
If you are struggling with payments, talk to the lender early and get free debt advice.
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Lead reviewer
Luke Marley
Founder and Lead Reviewer
Luke founded CPUK in 2026 after seeing how hard it is for ordinary people to get problems with companies put right. He oversees our guides and checks them against official sources.
Research by Katie Burt, Co-founder and Operations Lead (17 years in the care sector, including managing services for vulnerable adults), and the CPUK Research Team. Researched with AI-assisted research tools, then checked and corrected by our team.
Last checked: 13 October 2026. We are not paid by the companies we write about. Adverts never affect our guidance. Read our editorial policy.
Sources and official links
- moneyhelper.org.uk/en/everyday-money/cut-your-car-finance-hire-purchase-and-other-finance-costs Checked 13 October 2026
- fca.org.uk/consumers/buy-now-pay-later Checked 12 October 2026
- financial-ombudsman.org.uk/consumers/complaints-can-help/expect/time-limits Checked 12 October 2026
- moneyhelper.org.uk Checked 12 October 2026