Outstanding Finance and Write-Off Checks Explained (Cat S, Cat N)

Outstanding finance: the one that can cost you everything

Here's the situation people don't expect.

If a car is on hire purchase (HP) or a personal contract purchase (PCP), the finance company legally owns it until the final payment is made. The person driving it has possession, not ownership.

So if you buy that car privately while finance is still outstanding, the seller had no right to sell it. The finance company can repossess the car from you, even though you paid for it in good faith. You lose the car, and your only recourse is chasing the seller, who has your money and may well be untraceable.

This is why a finance check exists. It is not a formality.

Buying from a VAT-registered dealer offers considerably more protection here, since you generally acquire good title and the dealer carries responsibility. Private sales are where the risk sits.

What to do: run a finance check before any money changes hands. If finance is outstanding, either walk away, or insist the seller settles it first and provides written confirmation from the finance company. Never accept "I'll pay it off with your money" without that confirmation in writing.

Write-off categories, in plain English

When an insurer decides a car isn't economical to repair, it's written off and given a category. The current system has been in place since October 2017.

You may still see Cat C and Cat D on older cars. That's the pre-2017 system, roughly equivalent to S and N respectively. The marker stays with the vehicle permanently.

Cat N is not automatically minor. Non-structural covers a wide range, including electrical faults, water damage and theft recovery. A Cat N car can have significant issues that simply didn't involve the chassis.

Why write-offs matter more on an EV

This is the part that's specific to electric cars, and it's genuinely important.

A write-off marker can invalidate the battery warranty. Manufacturers commonly exclude vehicles recorded as salvage or written off. So a Cat S or Cat N electric car may have lost the cover on its single most expensive component. That's a very different proposition to a Cat N petrol hatchback.

EVs get written off more readily. Insurers are relatively quick to write off an electric car after underbody or water damage, because assessing whether a battery pack has been compromised is expensive, specialist work, and they would rather not carry the risk. That means a Cat S or Cat N EV may have had damage in exactly the area you'd most want reassurance about.

Damage near the pack can be invisible. A repaired car can look immaculate and still have a compromised pack or corroding high-voltage connections. Flood damage in particular can cause problems that emerge later.

Insurance and resale are both affected. A write-off marker follows the car forever and reduces what you can sell it for.

Should you ever buy a Cat S or Cat N EV?

It can make sense, but the calculation is different to a petrol car:

• Expect a substantial discount. Typically 20% to 40% below an equivalent clean car, and that discount needs to compensate for the lost warranty as well as the marker itself.
• Establish what the damage actually was. "Cat N" alone tells you very little. Ask for the insurer's report and repair invoices.
• Get the battery health checked regardless. On a written-off EV this stops being optional.
• Check the warranty position directly with the manufacturer using the VIN, rather than assuming it survives.
• Check insurability before you commit. Some insurers decline written-off vehicles, and others load the premium.
• Accept it will be harder to sell on.

For most buyers, particularly anyone nervous about EVs in the first place, a clean car is the simpler decision.

What else a full check covers

Beyond finance and write-off status:

• Stolen marker against the Police National Computer
• Mileage verification against MOT records, catching odometer discrepancies
• Previous keepers and plate changes, since frequent plate changes can be used to obscure history
• Import and export markers, which matter for EVs because warranties are territory-limited
• Scrapped marker, in case a vehicle recorded as destroyed is being sold

The order to do things in

1. Get the registration and VIN from the seller before you travel
2. Run the history and battery check
3. Only then arrange a viewing
4. Verify the VIN on the car matches the paperwork and the V5C
5. Confirm the seller's name and address match the V5C
6. Never pay a deposit before the checks are clear

Our outstanding finance check and write-off check cover the history side, and the Used EV Check covers the battery figures alongside the MOT and mileage picture.