Most financial institutions that provide asset finance, register their goods with agencies that provide information regarding ownership. This benefits both parties, the finance house and the hirer. When an asset, particularly a vehicle, is being taken as security against finance, it is important for both parties to be confident of ownership. The most well known register that is used by Finance Houses and is available to the public, is a register known as Hpi (Hire Purchase Information). For a small charge, you can check with Hpi whether the goods are already registered on finance, and with vehicles, it would also show if there had been an insurance loss registered against the vehicle or if the vehicle had been previously stolen.
Of course, this information would only be available, if the current owner provides this information to Hpi to add to their register. Therefore, it should never be taken for granted that if it isn’t showing on finance, that it is infact clear of finance.
If it did show as being on finance, it would provide an agreement reference number, date it was registered and a telephone number of the owner.
It is very common to have to liaise with the current finance house to obtain a clearance letter from them before further finance can be secured against the asset. Once a finance house has taken an asset as security, this information is provided to HPi, so that the information is there should anyone else check the asset on the register. The register can hold data against anything that has an identification number and it is sensible to register all types of assets, not just vehicles. If finance is already showing against an asset, it is imperative that the current outstanding finance is settled prior to any further finance being provided against it, otherwise funds may get released but title would not have passed and can prove catastrophic to both finance house and hirer.
With so much fraud around today, the use of trackers is becoming more and more attractive to both finance houses and the hirer. From the finance house point of view, it provides comfort that the asset being financed can be tracked at any point during the term of the agreement.
From the hirers point of view, it may provide a reduction in insurance premiums as well as providing the owner with comfort that he can also track where his assets are, which is beneficial to employers with a large workforce that may work away from the office quarters. The cost is relatively small in comparison with the cost of the asset, and can in some instances be a condition of the underwriting, especially on specialised large items of plant or high value sports cars.
With nearly all types of finance agreements, it is a condition of the terms that fully comprehensive insurance is taken out on the goods.
Some finance providers will ask for proof of insurance and some may request that they are noted on the insurance policy as the beneficiary should a claim be required.
If a claim has been made for a total loss, then the finance repayments should be maintained until the insurers settle in full.