I cannot afford my monthly car loan payments anymore. Due to lifestyle changes, as of right now I owe a past-due amount (2 months behind.) What can I do to get out of this loan what would defaulting do? What are my options I have poor credit already.
I tried negoitating with the creditors to work something out but they don't want to budge.
What should I do?
2007-03-05 21:48:35 · 8 answers · asked by DarkGremio 2 in Business & Finance ➔ Credit
I don't think you have much in the way of options. At two months behind they are getting ready to repo the car. At three months they are going to start trying to repo the car.
You need to clean out the car of your personal possessions, clean up the car so that it looks nice, drive it to the car dealership and hand them the keys.
This will show up on your credit as a voluntary repossession, which is a shade better than an involuntary repossession. You may even want to call the creditors and tell them what you are going to do.
This is not good news, it is going to really hurt what is left of your credit, but it doesn't sound like there is much you can do about it. It's going to be quite a while before anyone will loan you money to buy another car. But at least if you have a voluntary repossession on your credit it shows you co-operated with the creditor as opposed to some tow company coming out to repo it.
So once they take back your car they are going to quick sell it. This may even involve selling it an auction, just to get rid of it. They are going to sell it for a fairly low price. Whatever they sell it for will go against what you owe on it. The difference you will still owe. So if it is worth $20,000 and you owe $23,000 they will sell it cheap (maybe $17,000) and you now owe them $6,000 in this example. Plus they will add on late fees, penalties, interest and other charges. So now you might owe them another grand or so. They will then proceed to sue you for this shortfall and eventually if you don't cooperate get a judgment against you and garnish your wages.
The name of the game right now is cooperation. Every thing they have to do which causes them hassle is going to come right back to bite you on the butt. If they have to come and collect the vehicle, they are going to add on a towing fee, debt collection fee, storage fee, another penalty etc. Every single little expense you cost them, will eventually come back to you. So this is why you need to be really cooperative with them. Call them up, ask where they would like their car delivered. Do everything they ask (that you can), and they may go easy on you.
When they let you know what the shortfall is, make arrangements to pay it off, even if it is in installments of some kind. If you start ignoring their letters, they will get a judgment against you with a view to eventually garnishing your wages. Every time you cause them to take extra steps in getting their money back they are going to add on the legal costs, interest, and anything else they can to the debt.
Sorry to be so negative here, but repos are a ***** and most people don't realize just how serious they are. The only way out as I can see it is to try and sell the car to someone, have them take over payments. This at least will save you from a repo. Of course if you are upside down on the vehicle, no one is going to want it.
Whatever happens. Good luck.
2007-03-06 01:05:55 · answer #1 · answered by ZCT 7 · 0⤊ 0⤋
1
2016-09-26 07:36:06 · answer #2 · answered by Lavina 3 · 0⤊ 0⤋
Well its like stealing. How would you feel if you loaned someone say $5000 and they said my lifestyle changed so I can not pay you back. You would be mad and maybe take them to court to try to get it back if possible. I think if you default, your credit will just get worse, they will also come get the car back. So then you will have no car and no credit either. Credit is very important in life and should be taken seriously.
I dont know much about your situation but maybe you could pick up some extra monthly cash somehow. put your computer to work. get a part time job. If you let this go I think you real really regret it later. My opinion
2007-03-05 22:02:13 · answer #3 · answered by richcu 2 · 0⤊ 0⤋
well i think what is going to happen is you are going to have to turn your car in (or whatever or if it gets repo-ed) then the car loan ppl will sell the car for what ever they can get then you will have to pay the remaining balance on the car if any even though you don't have the car anymore.
welcome to adulthood....
2007-03-05 21:53:06 · answer #4 · answered by Anonymous · 0⤊ 0⤋
Sell your car!
If you can't afford your monthly payments sell your car.
Use public transportation.
2007-03-06 01:23:34 · answer #5 · answered by Vampir V 3 · 0⤊ 0⤋
clean out your car - it will be repossessed shortly - and everything in the car will be gone - and sold to pay any back monies
clean it out NOW! CD's Tapes purses (should never leave in there) guns (should not be in there) child carrier
trunk , too!
so sorry
2007-03-05 21:53:02 · answer #6 · answered by tomkat1528 5 · 0⤊ 0⤋
sell the car. you dont want them to come and get it
they will sell it for way less than its worth and come after you for the difference. You can sell it for more.
2007-03-06 03:56:29 · answer #7 · answered by heybulldog 5 · 0⤊ 0⤋
Listen to ZDT, he is the only one here who knows what he is talking about.
2007-03-06 01:37:15 · answer #8 · answered by ? 7 · 0⤊ 0⤋