Is there a legal way of getting out of a loan on a used car?

Question

I have a van worth 3,000 with 10,000 left to pay. I have been paying for six months 400 a month and it seems I have paid nothing at all because of finance charges. Is there a way to walk away without getting a repo? I live in California.

Answer 1

Who told you it was only worth $3,000? The dealer? Go to www.edmunds.com and see what it is REALLY worth...then Sell the van and take out a small personal loan for the difference between what you sold it for and what you owe on it to get a clear title. The only legal moral way to get out of a loan on anything is to pay them the money you owe them.

I am guessing that your credit is bad...but even so...go talk to a banker about borrowing the money with a Personal Loan that has no collateral. You should be able to get a loan directly from a bank for under 10% interest.

Another possibility is to just get REALLY MAD at this stupid loan and pay it off in 6 months...Take a second job...have a garage sale...cancel your Cell Phone, internet service, and Cable TV,... quit buying soda, coffee, tea, beer, etc... You really can live on tap water for 6 months...Quit eating at restaurants for 6 months... and use that money to pay the darn van off....oh yeah, and quit smoking too...

Now... NEVER borrow money to buy a car again!!! Cars go down in value and if you need to sell it you have a big problem! Get on a Written budget, always spend less money than you earn and you will not have to worry about money again. Good Luck!

Answer 2

You're stuck with it.

Even if you go the repo route, you will end up owing more because they will auction it and then go after you for the difference between selling price and the $10K. So if it's sold for $500 at auction, you will owe $9500!

Answer 3

No. Own up to the responsibility, and take the lesson.

But paying more than 400 a month will lower your principal and you'll pay it off quicker.