Ok we have a sunfire and owe 15 on it (got ripped i know) well we’ve just bought a house and other things and now are feeling a little spread thin. (we’ve had the car for about 2 years it’s an 04′)house is most important so were considering letting the car go back. voluntarily if better and before we owe 3 or 4 payments currently were only late on 1 payment. but it has to go. repo?
if not selling is a problem too cuz where we just bought the house we wont be able to take another loan to pay the difference for what we will have left to pay back after auction.
how do payments work on what you owe after auction?
so there is no kind of payment plan at all? cuz i’m really expecting them to repo it for like 8,000 and we owe 15 theres no way i could come up with 7,000 any time soon or ever lol. we refinanced last june and it didnt help much lowered it by 20. we only did it so we wouldnt owe a payment for 3 months and it was needed at the time. so are there any other suggestions?
i can’t take it back to the dealer if i refinanced through a credit union can i? It’s not in perfect condition either
dents and interior is far from new anymore (no holes or tears or bad stains though). so if i go to a bank (different one) see what they would loan someone for that car(cuz i know they have to look to see if the car is worth it for the new buyers) and see if our credit will allow to borrow the rest then sell from there. couldnt i do that? mouthful!Originally posted 2009-04-03 07:35:47.
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{ 9 comments… read them below or add one }
Sell it back to the dealer, its a pretty new car they’ll probably give you a little more than having it repod where youd lose money. Talk to different dealers or ask if you could have a break on the loan from your lender.
Once a vehicle is reposessed and sold off, any balance due is due in full immediately. There are no payments.
Rather than let the car go back, see if you can re-finance it. You could get a lower payment. Otherwise you’ll have to pay the difference between the auction price and the amount owed on the car. Otherwise turn it back in and wait for the bill, then file bankruptcy on it.
You can file chapter 13, keep the car and only pay what the car is worth now.
How you handle it all depends on how you want your credit to look afterwards.
how ever much you still owe on the car after the auction (where I live anyway) you have 90days to pay off car or take out a new loan, which after a repo good luck on a loan.
If you let a car go back (voluntary repossession) The bank will sell the vehicle (usually at auction) and apply the proceeds (less all expenses and fees) to the loan balance. It will most likely sell for somewhere in the $6000-8000 range, depending on miles and condition. The fees will most likely be in the $500 range, so you are looking at a net credit to your balance of no more than $7500. This is going to leave you owing a balance of at least $7500 and most likely more.
The bank will want that balance to be paid in one payment. They may work out a payment plan for you, but more than likely they will file suit, obtain a judgment and garnishee your wages (and those of your spouse if you were both on the loan.
It would be a whole lot better for you to find a way to make the payments on the vehicle. Perhaps a second job might be needed for a while. A repossession will remain on your credit for 7 years, and the deficiency balance will remain reported for 7 years after you pay it off. You need to find a way to avoid the repossession
With a repo, whether it’s voluntary or not, what they will do is put the vehicle up for sale. If it sells for less than what you owe (and you can bet it will) you are responsible for the difference, in cash, immediately. You can’t sell it yourself without their permission because you don’t own it, they are still a lien holder on the title. Go to the dealer and talk to them and see what, if anything, they can do for you.
never sell back to the dealers, they will take you for all they can, especially if they know your in financial trouble
sell it for as much as you can and if you are still under, get a personal loan through a credit union
you can also refinance your home after 6 months of timely payments (and good credit). when you refi, you can include the amount of the car in it so it will be spread of the life of the home loan. your payments will go up about 10 to 15 bucks a month for every 1K added
if you get it repoed, even if voluntary, it still goes in your credit
IF YOU COULD FIND SOMEONE WITH GOOD CREDIT THEY COULD ASSUME YOUR LOAN, YOU ARE STUCK WITH THE CAR SO YOU MIGHT TRY TRADING IT IN FOR A USED CAR WITH ENOUGH BOOK VALUE TO HIDE YOUR NEGATIVE EQUITY. IF IT QUALIFIES YOU MIGHT SPREAD OUT YOUR PAYMENT ENOUGH TO LOWER THEM
Fire4511 gave a great answer. I’ll only add that you should at least call the bank. Since you already know the worst case scenario, they can’t possibly give you any worse news. Banks would rather not repo a car as it means they will usually lose money. Plus the cost of taking you to court.
Why did you knowingly spread yourself so thin on finances? A car repo will look very bad on your credit. And do you really want your wages garnished?