what is the best thing to do when your up to your neck in debt?

Question

I have 2 cars that I got for me and my wife back in 03 but I dont make as much as I used to and have been behind on the payment for the longest time, should I just let them go and have them both repoed or try to settle something with the finance co. and keep them we still like them and are very reliable we have never had any problems with either of them, If I do let them go can I possibly get financed for something cheaper? with 2 repos on my credit

Answer 1

Do not let your cars get repo'ed. If you've been paying on them for three years, you should surely be able to sell them for what you owe on them. Sell them, trade down, do something like that. Don't go the repo route.

If you let your cars go back what will happen is they will take the cars from you and sell them off cheap. If they sell for less than you owe you will have to make up the short fall, they will pursue you for the difference.

Once you have a repo on your credit it is like a big red flag that shows up whenever you apply for credit. A repo is about as bad as it gets. It shows a future lender that you are irresponsible and don't keep your agreements. This may not be true, but lenders don't really care less if you are a nice person that fell on hard times. All they care about is getting paid back on time and in accordance with the agreement they make with you.

Two repos on your credit is going to make you look like a total financial disaster. Your credit score will take a nose dive and you will probably find that your interest rate is so incredibly high that your payment may even end up worse, for an older lesser quality car. That is if you can even get financing at all. Most lenders are going to consider you such a high risk you are most likely going to get badly ripped off.

Answer 2

Not to be a smart a$$, but the best thing to do is stop spending.....that means you have to cut out everything that is completely unnecessary. Get rid of all the credit cards, meals out, cable, extra phone lines, etc...it's easier said than done, I know. But think of it as mostly temporary (except for the credit cards). Second, consolidate. There are a lot of consolitation companies that will help you. Third, try to refinance the cars or trade them both in on one car that has cheaper payments. But do not let them repo them or your credit will be shot and you will have to pay even more for another car. Fourth, talk to your boss about a raise, go prepared to sell yourself as an asset...if you don't feel you have a good fight then start working hard now so you will have a good selling point sooner. Your wife as well, if she works, encourage her to ask for a raise. You would be surprised at how willing empolyers may be to give raises when the idea is given to them. Good luck to you!

Answer 3

Stop taking on new debt and just start paying slowly one month at a time.Once your auto loans are paid off use the payment amount too apply to other credit card debt.Also keep driving the car you have for about ten years total instead of rushing out to purchase a nother one as soon as loan is paid off.There is no reason that you should bankrupt yourself trying to keep up with the jonses.A repo on your credit report would not be good,can you both survive with one car or not is what you have to figure out and if you can then sell one and keepthe other one.Most of the baby boomer showoffs are broke that is why they say that they will work during retirement HAHAHAHAH baby boomers are broke nanananaaana.

Answer 4

What ever you do, don't let the cars get reposessed. Call the finance company and try to make and arrangement to either refinance or to turn the vehicles in. They may be able to offer you a solution (don't expect to get out of it for free though). A repo on your record will haunt you.

Answer 5

Look into Dave Ramsey's plan. In addition to Financial Peace University, he's also written a book called The Total Money Makeover. My husband and I have started on the plan and have already paid off $1000 in debt in less than a month.

He makes a lot of sense. He also has a radio show that you can listen to online (he has his shows archived), and he deals with questions like this in almost every show.

Answer 6

Best bet is to see if you can consolidate your loans to one amount that could be cheaper. Otherwise, ring the company and see what they can work out.
If you let them repo it then you will have a black mark against your name for ages.
Talk to someone. Maybe see if you can get rid of one of the cars and get something cheaper instead.

Answer 7

This would be a good question for Dave Ramsey. I recommend him highly. He has written several books on getting out of debt, and he created the Financial Peace University, which is a 13 week course offered at many locations to help people get out of debt and stay that way. It truly takes a change in your lifestyle and your way of thinking about money and yourself. Good luck to you! I am a single mom, divorced 2 years ago, and was $40,000 in debt. In two years, after FPU, I am now only $20,000 in debt.

Answer 8

What ever you do, don't let the cars get reposessed. Call the finance company and try to make and arrangement to either refinance or to turn the vehicles in.

Answer 9

I extremely have been by using H*** and lower back interior the call of love. Had my heart shattered and my existence destroyed. in spite of everything that, i might nevertheless say that specific, that is properly worth it. If for no different reason than the certainty that it brings out the wonderful in who we are and promises us a glimpse of what the international might desire to be like, and a small style of heaven. Love is what conjures up us to be extra effective people, to place others until now ourselves. Love is the clarification people triumph over their own inner demons, that is what provides us the capability and braveness to push ourselves farther than what we recognized as our features.

Answer 10

Banks and finance companies are in business to borrow and to lend money. They are much more interested in seeing money come in than going out and repossessing cars and other things. They are very helpful, in general to people who get in touch and try to make good on loans that are going bad.