Bankruptcy or repossession?

Question

I have a SUV that I owe 18,000 dollars on. It only blue books for 15,000. We've been to dealerships, nobody will let us trade it in because we have no down pymt and we are upside down on the pymt.
If we let the car go to repossession, they auction it, it doesnt bring the payoff, in what ways will they come after me for the remainder? Can they take my home?

We arent behind on it, we just can no longer afford it. We dont have good enough credit to get a loan for the remainder payoff if were were to private sell it. Friends and family giving us the money wont work because they dont have it either.
I'm so frustrated. But thank you for your answers

Answer 1

Technically they can obtain judgment against you and go after your house. But most likely they will absolutely kill your credit and send you to collection. It will cost you a lot more than the 3000 you are short now. You will never be able to refinance your home, buy another car. Just find a way to deal with this situation. They will not be after you for just 3000, they may auction it off for 10,000 and will go after you for the balance also they will be collecting all of the expenses they will have liquidating the car. You probably should just keep the car for now and make payments, at some point you will no longer be upside down on it, since the rate of depreciation will slow down, but the loan balance will start going down quicker as you make more payments.

Answer 2

Do NOT ruin your credit because you are 3 or 4 thousand upside down on a car. Filing bankruptcy will cost 1-2k, plus time off work and you might be required to pay off a portion of your debts anyway. And you will ruin your credit. If you default they will try to collect on probably what will be a 6,000 deficiency balance. Sorry I think you are looking for the easy way out of minor problem.
Cancel cell phones, cable, internet, that is probably 250 per month. You can get those back when you get the vehicle sold. Sell household items and send in on car. Get part time jobs, probably 500 a month there. I know easier said than done.
If you can get the car paid down to 14k you can sell it.
Try taking it to a consignment lot.

Also if you default, I assume you will have to get some kind of vehicle. You said you have no savings, so how will you buy a car. If you buy a 1k junker it will probably have 1500 in repairs the first months you own it. You can work your way out of this. Good luck.

Answer 3

If there is a voluntary reposession or they reposess it, that is a serious hit to your credit. If you feel you cannot afford it, you should sell the car and borrow from friends/family to pay off the last 3k.

If they get this car back, they will sell it to a "sister used car lot" for a deal and come after you for the difference. They then tidy up your SUV and make a nice profit on it.

Now lenders will let you trade it in while upside down, but you'll roll it into your next car and have a higher interest rate because of this. That interest rate continuously increases as they feel out the level of risk.

Can they come after you home, laws are specific for each state. I'd avoid that route and try to sell on your own.

Answer 4

see if your finance company can hold off payment or tack it on the end of your plan so that you'll have time to pay it off there are a lot of ways to work with people on this thing and if not they'll kill your credit. I'm not shore how they come after people for payment but I know it wont be nice. I don't think they repo your home though I think it's just a credit thing in the end. Plus some bankruptcies make you give up the car in the end anyway.

Answer 5

Try to sell it to a private party and see if you can get a loan from a credit union for the difference.

Depending on the laws in your state, I don't think your home is at risk because you probably hae a homestead exemption.

Try to avoid repossession; it will hurt your credit.

Maybe you can negotiate with the finance company to trade it in against a less expensive vehicle - that might reduce your payment. It will also probably reduce your operating costs.

You should be able to avoid bankruptcy in this case.

Answer 6

Your best bet is to sell it privately. A repo on your credit report looks absolutely horrible.... not to mention what it does to the score.. EVEN if you pay it off! If they repo it and auction it, any remaining balance as you know you are responsible for. No they can NOT take your home, however, they can garnishe wages and tax returns..... and basically make your life a living hell.. phone calls.. mail... etc... it's a royal pain..

Sell it out right... the blue book and the retail are totally different.. and if your in the right place I bet you can sell it pretty fast and not have a left over amount to pay..

Answer 7

If you own a home, I would suggest getting a home equity line of credit for the payout amount on the vehicle and paying it off. The interest rate on a HELC will be less than typical vehicle financing.

If you default on the car loan they cannot take your house, but I would think they could certainly place a lien on it.

Answer 8

ask some one for the money and what they give you then get the rest by helping people around you neighborhood and then help people you know and get a loan or sell your truck and with the money you earn pay it off

Answer 9

You can not sell it without the title. So your best bet is to use your income tax monies or double up on your car payments or pay a little more than your car payment till you can catch up.

Answer 10

I usually would not recommend this... But bankruptcy chapt 13 ( a repayment plan) is better than repo.. Have you tried selling it out right? Are you behinf in payments?? are your other bills in-line ?