The car is impounded. Must the HP company be informed?

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You are now entering a very grey area and you may need qualified legal advice because much depends on the precise agreement you have with your hire purchase or finance company.

Although you are the registered keeper of the car you may not actually be the beneficial owner. You may not achieve actual ownership until the last payment has been made. When a car is impounded the police have to find out who actually owns it and take reasonable steps to inform that person of the situation. It is conceivable therefore that the finance company will be told about the seizure even if you don't tell them yourself.

If you don't get your car out of the pound in time and your car is disposed of you will get nothing back for it but you will still, possibly, be liable for any outstanding payments on it. However the HP/finance company themselves may have a right to recover it. They may even arrange to collect the vehicle before you do. If they do collect it they will probably have to pay outstanding charges before they can take it away. They will probably have other administrative and/or legal costs to pay too. What happens then between yourself and them is, again, dependant upon your precise agreement with them and legal advice may be highly recommended if you cannot reach an amicable agreement with them.

car released from impound
I got my car back!

If you do not inform them and fail to get your car released in time it possible that you could be held to be negligent and further legal costs may accrue.

It is quite possible that a condition of your agreement is that the car is insured comprehensively. If it is in the pound because it was uninsured then this would show a breach of this condition.

If your impounded car is subject to HP or other forms of finance you may be best advised to act as quickly as you can to get the car released. If this is done before those who provide the finance react to the situation then you may well have no further issues on that score at least but remember that you may well have breached a very compex financial agreement, in which case - as we already stated several times - you may need proper legal advice from someone competent to interpret the laws of contract.

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