Less than a year ago I bought a car. Since then my financial situation has changed dramatically to where I have doubts if I will be able to pay for it or not. This might sound naive but is there any way I could just say I wanted to return the car and not be liable for the remaining payments instead of waiting for the inevitable which is my not being able to pay on it?
2007-06-16 05:20:11 · 8 answers · asked by Anonymous in Business & Finance ➔ Credit
Definitely call the loan company. A lot of times, they'll work with you. At the very least, what can they say. No. That would change nothing in your situation. So it doesn't hurt to ask.
2007-06-16 05:28:44 · answer #1 · answered by dudley997997 6 · 0⤊ 0⤋
Please note that you will not get "kudo" points on your credit score for doing a voluntary repossession versus an involuntary one.
This is one of the main reasons that it would be wise to buy a car that costs even less than you can normally afford. Furthermore, I wouldn't buy a car unless I had a cushion in the bank of at least one and 1/2 month's salary in case 'ish happens.
And selling the car is not an option because you don't have the title and you have to pay the remaining balance to the finance company in order to get it.
Your last option is to do a WORK OUT arrangement with the finance company where they may be able to reduce payments for like three months and then return back to normal, but if you don't even see yourself affording the car in the long-term, than all you can do is chalk this up to experience.
2007-06-16 14:26:14 · answer #2 · answered by DaMan 5 · 1⤊ 0⤋
Auto finance is what I do for a living and you need to call your lender A.S.A.P. and see if you can work something out because if you let it go back they will sell it at auction for less then it's worth and come after you for the balance plus all fees for the towing, storage, auction,interest and lawyers.
This could amount to several thousand dollars and if you don't pay they will take you to court and get a judgment at that point they can attach bank accounts, garnish wages (if your State allows it) and file liens on any other property you may own like cars, boats, land and homes.
Add to this that the repossession and the judgment will show on your credit for 7-years making it very hard to get any other type of loan without making huge down payments, paying large fees and State maximum interest rates and you begin to see why you do not want this to happen.
Call your lender and work this out now before it gets worse.
2007-06-16 13:18:06 · answer #3 · answered by ? 7 · 1⤊ 0⤋
When you buy something and are on a financial schedule with them (a bank), you owe the money. You don't get to return the item usually. What is the blue book value? Will you even get enough money for the vehicle if you sold it (to the dealer or private party) to pay off your loan?
And if you leased it, you'd be breaking the contract. They can sell it for you on a lease, but if they sell it for $3K and you owe $6K, you are still responsible for the remaining $3K on the same payment schedule more than likely.
If you don't keep your payments, you are not only risking your vehicle, you are risking your credit/credit score. That will affect you for years.
Next time buy a car that is cheaper so you can get it paid off in time.
2007-06-16 12:28:30 · answer #4 · answered by Michelle 4 · 0⤊ 0⤋
The short answer is yes, if you return the car to the dealer they will take it back since it's the collateral on the loan. But that does not mean you're off the hook for the remaining payments. What they will do is auction the car off and whatever the reaminder is you are liable for. You can't just bring it back and say to them sorry, I can't pay for it. You might even think about selling it yourself but you would have to pay off the entire loan before the title is released.
2007-06-16 12:34:39 · answer #5 · answered by douglas l 5 · 1⤊ 1⤋
If it still has decent Blue Book value on it (www.kbb.com) and the value of it is more than you owe, sell the car privately for AT LEAST what you owe on it - if the "private party" value of it is more (kbb.com will tell you.) try to sell it for more - then go pay off the loan and use whatever you have left to get a cheaper car.
It's not like a shirt you bought that doesn't fit, you can't return it. But, if you stop paying on it or can't pay on it, you'll have bigger problems if it gets repo'ed.
2007-06-16 15:12:05 · answer #6 · answered by zippythejessi 7 · 0⤊ 0⤋
Depends on how much is left owed, and the present value of the car. Contact your finance company and ask.
2007-06-16 12:24:22 · answer #7 · answered by luckyaz128 6 · 0⤊ 0⤋
Inquire about refinancing the remaining balance and explain your concerns. It does not hurt to ask.
2007-06-16 12:47:23 · answer #8 · answered by Anonymous · 0⤊ 0⤋