All about voluntary repossession - The Bills.com Blog

My husband had a loan w/a finacial company for a van he purchased Nov 2006. November 2007 he was incarated. I called the company to tell them and that I currently could not make the payments. They always were ruled to me so we never could work anything out but there was a recovery company that was to pick up the van. The gentlemen and I have spoke various times setting up to p/u the van but he had constant dilemmas. Then after 3 months of harrassing for the van the company wants to say they don't want it because it to old. Can they do this or can I still voluntary return it. Please advise.

Even if you surrender the van voluntarily, what will happen then is that the finance company will sell the van and apply the proceeds towards the loan. If there is any balance remaining, then the debtor would still be held responsible for the debt. This remaining balance is what they refer to as a 'Deficiency Balance'. I think that the finance company knows that even the sale of the van is not going to be sufficient to cover the outstanding loan and that is why they are refusing to pick up the van. I hope you did not co-sign the loan, in which case the finance company cannot hold you responsible for the debt. I suggest that you write a letter to the finance company explaining them as to what happened and maintain records of all your communication with them. Remember that voluntary surrender does not absolve your husband from paying the loan back, so it does not matter if the recovery company picks up the car or if you go to surrender it yourself.

Im in a position that I may need to voluntarily give my car back. I know that I have a deficiency and that its quite a bit. Typically what will a finance company do if you cannot afford to pay the entire amount at once and that someone may need a few years??

I'm getting a company car with Gas,Maintanance,Insurence paid.I have two years on my suv lease and at that point I will have paid $14,000 plus will have to pay over 30,000 in miles overage. Not to mention how much cost to fill up with gas weekely. After reading yours and other answers about voluntary surrending a vehicle, I still want to proceed. How long will it take to bring my credit score back up. For instance paying student loans and credit cards on time and keeping low balances....etc. What other things can I do to speed that up?

The finance company will continue with the collection efforts, such as selling the debt to a third party collection agency. You will need to speak with them to figure out a payment plan, even if it is a long term one. They may or may not agree to the plan. You will have to present your circumstances to them and hope for the best. Please keep in mind that they may also pursue legal efforts and potentially garnish your wages if your state law permits it.

It is hard to put a time line on exactly how long this voluntary repossession will affect your credit negatively. All the three bureaus, hold in close secret, the methodology used to calculate your score. You will just need to do the things you normally do, such as make timely payments and not max out your credit lines. Please remember that just because you surrender your vehicle voluntarily, any balance due will not be waived, in fact you will still be held liable to pay it back.

my ex-husband and I have a bank loan for an RV. My ex took possesion of the RV and agreed to make payments. Now he has advised the bank for voluntary respossesion. I cannot and refuse to pay for this loan. do I have any recourse?

If you signed on the initial loan papers, then you are responsible to pay for it, regardless of any agreements you and your ex-husband had worked out. The bank will look at the fact that you had signed for it initially, and they will hold you responsible for the payments as well.

I turned 62 and recently was diagnosed with copd. I have had to give up a higher paying job so that I can be at home. I had to be taken to an emergency room twice for complications by an ambulance. I do not currently make enough to pay all of my bills and have had to prioritize them. I need to give up a motorhome and another car so I can get by. I am trying to hang onto my house until the price goes back up and I can retire. I am currently employed by a co in Las Vegas, but with my health problems that could end at any time. I am currently thinking about ch 13 or vol. repo. Pls advise.

Before you go ahead with either a Chapter 13 bankruptcy or a voluntary repo, check to see whether or not the market price of your vehicles will be enough for you to pay the repective loans back. In most cases this might not be possible because vehicles and motor homes depreciate rather quickly. In any case, when it comes to matters such as bankruptcy, it is best that you contact a qualified and licensed attorney in your state to get an opinion on your best options as there are a lot of factors involved. You can learn more about Chapter 13 bankruptcy at: http://www.uscourts.gov/bankruptcycourts/bankruptcybasics/chapter13.html

My fiance and I will be moving out of the country the end of this year. We were considering a voluntary repossession on my car since i will not be able to pay it off before we leave. Is there any other way to handle this situation?

WHAT IF YOU PUT A MOBILEHOME IN YOUR NAME FOR SOMEONE ELSE. THE PERSON HAD THE HOME FOR 13 YEARS, NEVER MISSED A PAYMENT. NOW SHE WANTS THE HOME IN HER NAME, BUT THE COMPANY KEEP DENYING HER. SHE HAS EXCELLENT CREDIT NOW, SHE CAN'T HAVE IT FINANCED WITH ANOTHER COMPANY BECAUSE THE HOME IS A 1995; AND THEY WANT FINANCED A HOME OVER 10 YEARS. SO SHE SAID SHE WAS GOING TO VOLUNITARY TURNED THE HOME BACK TO THE LENDER; HOW WILL THIS AFFECT ME BECAUSE I HAVE A HOME AND CAN'T AFFORD TO PAY FOR ANOTHER.

Unless you can pay the entire loan back, I doubt that the lender will agree to any other kind of arrangement. Speak to your lender to see what your options are. Voluntary surrender of your vehicle may turn very well turn out to be the only option. This will hurt your credit pretty bad, but since you will be out of the country, I am guessing you will not need the credit to borrow more funds. In time the negative affects of the repo will decrease and you will be able to bring up your credit scores by taking the proper steps. For more information credit score I suggest you check out Bills.com's credit help page at http://www.bills.com/credit-score/.

A voluntary surrender of a mobile home is equivalent to foreclosure of a regular home. This will affect your credit pretty bad. If you already have a mortgage on your current home, then the effects of this negative item on your credit will not do anything to your existing loan terms. But, if you plan to refinance that you may not get a good rate or even be refused for a refinance loan because of this. I suggest you speak to this other person to see if she can arrange the money some other way, so that she can prepay the current loan and then transfer the rights of mobile home in her name.

I am in a terrible situation. I am financing a car from DriveTime and owe about 13,000.00 on it. I have made every payment on time so far. The problem is that I am a Canadian citizen, here in the USA on a work visa that expires mid June. It was supposed to be renewed, but wasn't, and so now I am being deported and will no longer be a legal resident of the USA. I cannot bring my car over the border, because I can not get it through customs or register it without a letter from my leinholder. And Drivetime refuses to let me cross the border with it. BUT, I also cannot keep the car in the States under my name, because I am financing it so it needs to be registered and insured at all times, which I legally cannot do when I am no longer a resident of the state of Florida. They are saying that I will have to have the car repossessed, but I don't want that on my credit! How can a company force me into repossession if I WANT to make my payments? I need some advice on this situation, because nobody has been able to help me so far!

Stephanie, I can understand the dilemma you are in, but you only have so many choices apart from a voluntary reposession. First off, you don't mention in your question as to whether this is a loan to own or a lease arrangement. If it is a loan, the first option would be to pay off the loan to get the lien taken off so that you can transfer the vehicle back to Canada. Once you reach Canada you can opt for a used car loan once again. In this way you would only have to arrange for the payment till the point that you are able to get the vehicle back to Canada. You could also sell the car to recoup whatever you can and close out the loan by paying the balance.

I'm currently looking at selling my vehicle for blue book. My aim is to get rid of it by the end of this month because I can not afford it. However, I owe more than what the car is worth and I can not afford to pay off the balance either if the car is sold. My credit is already too bad to qualify for a loan either on my own, or with a credit-worthy co-signer, to cover the difference, and after speaking with my finance company, they either won't or can't finance the difference if I sell my vehicle. Because I can no longer afford the vehicle, and I can't sell it for what I owe on it, and the bank will not release the title without the entire loan paid off...what other options do I have other than voluntary repo?

I have a leased truck which I owe $16,000 in payments. I was thinking about a voluntary repo to get out of it. I am aware that the lender may file a judgement on me for that balance, but my question is, considering it is a leased vehicle how will that work as far as what they end up selling the car for and what I have left in paymments. OR do they go by the buyout?

You can try and convince the person that you want to sell the vehicle, to take over the responsibility of your loan. He might not agree considering that the laon balance is higher than the value of the car, you may have to compensate him/her for the difference in value.

If you decide to turn in the car before the lease is over, in a creditor's eyes, you just did the same thing as defaulting on a loan. Creditors see that on a report and form the same opinion as if you decided to stop paying your mortgage. Unless you make a deal prior to the termination, it's a voluntary surrender, which equals repossession. Defaulting on a lease is a breach of contract, and it has adverse effects on your credit report. It's like deciding to pay 75 percent of your debt instead of 100 percent. Adding to the financial problems, you're often faced with a stiff early termination fee. You're not only out of a car, but you have less money in your pocket and a damaged credit report.

I am currently in a situation where I can no longer afford the monthly payments for my SUV. I am considering voluntary repo of my vehicle, but as everyone else, Im concerned about the negative impact it will have on my credit score. I am in somewhat of a unique circumstance in that I am a newly graduated physician, but I wont be earning a "doctor's salary" for several more years. Right now my score is good borderline excellent,but I realize that it will drop substantially after the repossession. However I dont plan on making any major purchases for atleast 3-4 years. My question is, will the fact that my income will increase substantially over the next few years allow lenders to be a bit more forgiving of my repossession?

Keep in mind that the repossession will show up on your credit report for more than 3 or 4 years. That being said, lenders look at several factors when extending credit, mainly credit score, credit history and income. If you manage your credit responsibly for the coming years, and coupled with the fact the you expect your income to increase substantially, there is no reason why your score should not be back up to good or even excellent levels at that time. For more information on credit scoring, I suggest you read through our credit resources page available at: http://www.bills.com/credit-score/.

My son purchased a vehicle with his girlfriend and now they have split. She has the vehicle and no job and can't make the payment. He also paid off her car that they used on trade for the new vehicle. What are his options? We need help fast. He cant afford to make the payment alone either.

If you're son signed for the car jointly, and cannot afford the payments on his own, then I do not see any other options apart from a voluntary repossession. What that means is that you have to talk to the lender and explain to them your present situation. Most likely, you will find them to be inflexible because car loans are secured debts.

i bought a car had it for almost two years and did a voluntary repo and the finance company sent out a notice of what my car was sold for then later i recieved a call from the creditors about making payments on the balance,i ended up not being able to agree to the payment amount and so they still pursued to call me about making payment arrangements and i told them what i could send do think that its wise to send what i can for now in case the company pursues to a lawsuit or wait until i go to court to get it resolved?because i did let them know i wanted to start cooperating and paying off the balance but cannot do it to there terms.

A lawsuit will entail additional expenses for the Attorney and court fees, so if they are willing to work with you, then it is better that you pay them whatever you can so that it shows that you are at least making an effort to repay the balance.

I am in a horrible situation. My husband trusted into a finance opportunity called "FUN." A hummanitarian program they claim that can benifit you with good credit with a brand new car and somebody with bad credit with a brand new car. They claim that you purchace two vehicles in your name and in turn they will pay off both vehicles in eight months. Where they then will use the pink slip asset as collateral to make more money in other investments they would make with that collateral. Anyway, long story, the company ended up failing to pay, they broke promises and now my husband is devestated watching his credit be destroyed. He already surrendored one vehicle, somebody else is driving around our other vehicle that we can't even get to. My questions are: I didn't sign any loans on these vehicles, will it effect my credit even though we are married? How long will these repossessions or volunteerly repossissions be on his credit? HOW WILL THIS ALL EFFECT ME WHEN I NEVER WANTED HIM TO TRUST THESE PEOPLE IN THE FIRST PLACE? Thanks

If you did not sign the car loan documents as a co-signor, then you are safe with respect to your credit. But, and this is important, if you reside in a state where community property law applies, then even though the debt would not show on your credit profile, you would still be held liable for it because of community property law. Check this page to see if the community property law applies in your state: http://www.bills.com/collection-laws/

We have a 2005 Ford Taurus SE that the tranny just went out on. It's going to cost a bit over $3,000 to repair with a rebuilt tranny. The car is only blue booked at a touch over $4,000 in good condition. Here's the problem, we cannot afford to pay for the repairs, nor can we afford to keep paying for a dead horse,so to speak. We still owe $11,000 on it. We tried to get a newer, better for our family vehicle, but with the neg equity in the taurus rolled into it, we would end up paying almost $600.00 a month, which we cannot afford right now. The only way we see any light at the end of the tunnel is to allow a voluntary repo, which would bring our payments on a better vehicle down to a comfortable level.... Any suggestions? HELP!!!

A voluntary repo is as bad as a lender initiated repo. It is going to hurt your credit real bad. That is not the end of it; after the voluntary repo (if you choose to do so) the vehicle will be sold for whatever it is worth. If the proceeds of the sale are not enough to cover your loan (which is what will happen in your case), you will still owe the financier, what is called a "deficiency balance". They will continue with collection efforts on that balance just like any other debt.

I have a 1999 VW I purchased back in 2006 and since I have had this car I have lots of repairs and money into it. I had the lights fixed 3 days into haveing the car a week later I had took it back to the dealer to fix the differental gears the took almost a month to fix. Not to long after that I had the transmission repaired on it now the car costed me a total of 10,000 and I have put in about 4,000 in repairs. Just recently I started to get behind in my payments only because I put it back into the shop with the undercarriage to be repaired I paid that. I have the loan with Westlakes Financil I called them to tell them that I will not be able to make the payments on this car to go ahead and pick it up due to the fact that it just boke down again the fuel line went out it will cost me 2,000 to repair and I only owe 4,000 on the car so they said they were going to pick it up that was this was back in may of this year. I don't now what to do they keep calling and the car is just parked.

They must realize that there is no point in picking up the car as it will not be worth much. You have to realize that it costs the finance company a sizable sum of money to get a vehicle repossessed. They will assess as to what the market value is and if it’s going to help them recoup a reasonable sum of money if they do repossess it, to make it viable. Remember that surrendering the vehicle does not absolve you from the responsibility of paying the loan back. In fact even if they had repossessed the vehicle, they would sell it in an auction and apply the proceeds towards your loan (they would tack on the repo cost to you as well). If any balance remained, you would still be responsible for it. I suggest that you sell the car for whatever it is worth and try to pay off the loan.

One of my friends recently in a fear of deportation as he is subjected to for a feloney offense. He is loaning a car for the worth of the car. In case of deportation he may not be able to pay the loan as well as may have to leave the country. In such situation what happens to the car and loan he owe on it?

The Vehicle will get repossessed by the lender. The lender will then sell the car in an auction, and apply the proceeds to the balance of the loan. If the auction sale proceeds are not enough to cover the entire balance of the loan (which is usually the case), the lender will continue their collection efforts and report the debt on the borrowers credit profile.

My son has 2 Honda dirt bikes (new0 but we jumped to soon and cannot afford payments on both. We want to keep one but surrender the other. How do we know exact what they sell it for? They could say anything. Are we absolutely resposible for the balance. That stinks if we are.

You are responsible, per the terms of your loan agreement. You could call them and ask if they will take the bike back, but it would be unlikely, since most cars and vehicles depreciate by about 20% the day you take them off the lot (not being 'new' anymore). If you want to see what it is worth, you can try to sell it on your own and pay the difference, or check out kelly blue book (www.kbb.com ) for values. Good luck Ida.

if my car is repoed can they go after my husband for the payments.

If your husband was a co-applicant or a co-signor on the loan, then yes. If not, then they cannot. But, there is one other thing you have to be aware of. If you are resident of a community property state (for ex. California), and happened to buy the vehicle after you were married, then they could construe the vehicle as community property and then try to follow up with your husband for the loan balance, if any.

I am 20 and am most likley going to do a voluntary repo because I am about to go back to school, which I pay for on my own, and can't afford my car. However, does my lender lower the interest at all on my loan in order to get it paid off or does it stay the same? Basically are there any cases where my interest rate could be lowered for pay off?

It is unlikely that your existing lender will change the interest rate on the loan (I have not heard about instances of this). The only way that can be achieved is if you refinance your loan with another lender.

My son received a form from the lender stating that he is agreeing to a voluntary repossession (in California), waives all rights to the vehicle and agrees to be responsible for the deficiency. The form seems a bit vague to me since it does not describe the process after he turns the vehicle in nor does it talk about any fees. 1. Should he sign the form? 2. Should he have the dealer give him some kind of paper indicating that the vehicle has no damages and is in excellent condition? 3. Should he take pictures of the vehicle when he turns it in? Please advise. Thank you!

Banks usually do not disclose the internal workings of a vehicle auction. As good as the condition of your vehicle may be, these auctions do not fetch the price that you would get if you sold the vehicle in the open market. You need to ask your lender these same questions and see what their response is. They will usually inspect the vehicle at the time of the handover but I cannot guarantee that it will be the case with each and every lender.

I bought a car a little over a year ago, and have made every payment on time. Last week I was given a company car and no longer need my other car. Nor do I want to make the $600 payment. I was considering a vol. repo since I am upside down $30,000 and do not want to pay for a car I am not driving and have no where to store. I called the lender & I was literally YELLED at that a vol. repo was NOT an option and to figure something else out. I am COMPLETELY aware of the credit consequences. Can a lender deny my request? THANKS!!

A repossession will happen once you stop making payments. If you are aware of the consequences, you should also know that just by surrendering the car, you are not absolved of the outstanding loan amount. After the repo, the lender will auction the vehicle for whatever it will sell, and if the proceeds of the sale are not enough to cover the balance of the loan, then they will report the remainder of the amount as a deficiency balance on your credit report. This debt is basically unsecured debt, but they might even sell it to a collection agency.

BAD MORTGAGE!! HELP> I signed a contract to purchase a 28x80 RiverBirch mobile home and land in 2005. The home was $69K. When the pymnts came beck too high for what i budgeted for, I declined it. The dealer shifted me in and out of 5 mobile homes,NONE of which i signed a contract to buy. The last home, a 2006 Fleetwood 28x60,for $49K- I verbally agreed to buy it if the pymnts were within my budget. The dealer told me he called the mortgage company- and the pymnts, and interest were in my budget. I asked for a gfe, and sales contract on that home, I never signed one and never got one. I was rushed to closing the next day. The monetary figures on the closing papers were the exact ones that I signed for on the mobile home I couldn't afford. I told the closer this was incorrect. I also noticed on the second page, the mortgage stated I was buying a 28x44 RiverBirch- that I had never even seen. The vin was wrong,EVERYTHING was wrong. I told the closer I wouldnt sign unless I had my attorney. The closer threatened that if I didn't sign, "they" would accelerate the debt,put me in default and sue me. I have never bought a home and was scared. I had put $3K down and was told I would lose my down pymnt also. The closer then got a bottle of white out and started making all kinds of changes to VINs and description of the house, etc and made me sign it. I asked her if this was legal, she said yes- sign it. The title company never gave me a title for assessment for the Fleetwood so I could assess it and surrender it. 3 years have gone by and the bank has refused my pymnts b/c i havent surrendured the titles to the 2 homes it states I have bought on the mortgage. I explained this to the mortgage company- they foreclosed. I called the revenue office in my state and gave them the vin to the mobile home i bought [ i am still in it havent been evicted yet] the dmv told me that a title has never been applied for, nor is there a lien on the mobile home. The dmv told me I could get a clear title with no lien on it if I put up a bond for the title and then move it off the property the bank foreclosed on. Is this correct? Can I legally do this - as time is running out, the bank wouldn't talk to me and wrote me to STOP sending them money. Do I have ANY recourse? Can I move this house off the property with a bonded title? I have tried suing, and it does no good, fbi- no help,fha- no help, and several attornies want several thousand that i havent got just to help. What - if anything - can i do?

Wow, that is quite a story. I cannot believe that they strong-armed you into closing on a property before you had even signed a sales contract for your mobile home, though you may have actually received quite a bargain, as it appears that you may now own a mobile home free and clear due to this company’s aggressive sales tactics. If the state has no record that a title exists, there is no lien, and you are in possession of the property, then the state has every reason to assume that you are the legal owner and therefore issue you a title. However, I am not licensed to practice law in your state, and there may be many legal complications about which I cannot advise you. I know that you said that you cannot afford an attorney, but honestly, this situation is much too complicated for me to try to address in this forum. I strongly advise you to contact several attorneys in your area to discuss your situation; if anything they may be able to answer your question regarding the title to the property, though I would guess that the whole situation needs to be straightened out before any attorney could form a good legal opinion about the best way to proceed. You should probably contact your state or county Bar Association to explain your situation and ask about affordable representation; they should be able to point you to various legal resources in your area which may be able to assist you.

Dear Sam, Thank you for responding!! I have spoken- and hired several attornies who bailed on me. I just got out of a meeting witha great AR real estate attorney, and showed him all of my proof,and the letter from the state about no lien,nor title. I also got an eviction notice that he said to disregard because it was not signed by a jugde. He told me he would love to take the case, as I have all evidence,names,pictures,videos,etc...and I could get a huge judgement\settlement. HOWEVER, he is closing his practice and is going to serve on the AR Judicial Court as a Judge. He did tell me that "legally" if the bank has no title,there has never been one, and there is no lien- that I had every right to get a bonded title, and move my home-although I need an attorney to help me through the courts. I liked this guy- he was out for "blood" [money]- even though all I want is peace of mind. He did tell me the mortgage was fraudulent, and he didn't see how the bank could enforce it with 2 homes on the mortgage,no title,and whited out vins,etc.. on the mortgage. He stated the closing was supposed to be stopped if there was a dispute- not whited out and then filed at the county. I spoke with my mother [and yes I am 36 on disability, but she said she would help]. She told me if I could get an attorney to represent me that she would help pay the retainer, if I would pay court costs [if any] and fees for filing, etc.. That works for my situation. I just want everyone to understand I know we are in a mortgage "mess" as a country. I told the attorney that the monetary figures on my mortgage were the exact figures on the contract I signed on the home that I couldn't afford- therefore I backed out in hopes of getting a home I could afford and pay for. When I was sold this home had I gotten it for the price I was quoted,it had not been a defect, and I had not had to pay legal fees all over the place and still get no where- I could have payed my home off early [as I budgeted for] and just lived. It is shady mortgage companies,loan officers,and even title companies- you can't trust anyone. One part I did not mention about this whole deal is this, I used to be in law enforcement, and know judges and lawyers. The whole process, I wanted my attorney to help me through it- and he would have. However, the day my attorney was to come to the dealership to make sure things were going as planned, the salesguy called my attorney-pretended to be me,ended up cursing my attorney [who was a friend],and my attorney fired me [as he was on retainer]. The salesman had the nerve to call me and tell me he did this, he admitted it! Then, him- being in the military- begged me not to press charges because he didn't want to get discharged from the service. I got all kinds of promises, and got shafted, just for being "nice". I wrote a blog on a ripoff site about all of this. The president of the mortgage company wrote a rebuttal that I had buyers remorse, and he had never spoke with me- which is a lie. I have several emails from HIM admitting the mortgage is wrong and stating it would be fixed- it never happened. About the AR Bar Assn, that is a god ides. I did contact them- several times. I spoke to 4 lawyers,ALL told me to "walk away this is too complicated." Legal Aide told me "we don't do miracle works" the FBI told me "we don't investigate mortgage fraud" [when it states on their site the do investigate it] when I called they told me the same thing, when I contacted FHA [as I have an fha mortgage] they said "we can't help you", State Police wouldn't let me press charges, my local judge wouldn't look at my proof, all the attornies I have gone to have either taken money and dismissed me with letters stating "the parties at fault do not want to settle with you- there is nothing we can do", the AR atty General took all my proof for a month,sent it back with a letter stating "you have a ligitimate case,however the parties involved do not want to settle with you", the ARkansas Mobile Home Association wouln't let me file my complaint because they stated "[dealership owner's name],would never do anything like this to anyone,he is and pstanding citizen. This matter will not be investigated." Then the other numerous attornies listen and say "walk away it is too complicated." I told an attorney yesterday "what would you do if you bought a Cadillac Escalade,[and I am not advertising for any car brand], they delivered you a chevy cavalier,and you never had a title for assessment,but they were taking high payments for the escalade and the money you had paid in for the actual car they delivered was equal to the value of the car, and all of a sudden they refused pymnts b/c you never got the vehicle tagged b/c you couldnt register it without a title, and they told you "even though we took $28K of your money we coulndt apply it b/c you got the wrong car and we want it back- would you walk away mr lawyer?" That is the point about my home. He just told me to get out of his office that this was a mess he wanted nothing to do with." Imagine that. I do not know who reads these entries, I thank you Sam for responding. HOWEVER- I am in a time crunch and I am putting this in my blog here [I hope I don't get into trouble] IF THERE IS AN ATTORNEY LICENSED TO PRACTICE IN ARKANSAS THAT WILL LOOK AT AND TAKE MY CASE AND SUE EVERYONE INVOLVED, I WILL GIVE YOU 50% OF THE SETTLEMENT,NOT THE REGULAR 33%. I am sick, tired, and weary. I have all proof,and alot of the papers ready to go into a courtroom. I hope I am not offending anyone by trying to solicit help. I thank everyone.

I am sorry that you are having such a hard time finding adequate representation in this matter. You may want to contact the National Association of Consumer Advocates, www.naca.net. They specialize in consumer protection law, which is what you probably need in this situation. I looked on their website, and they have a few member attorneys who are licensed in AR. You may have the same experience as you had with the others, but hopefully not. If you cannot find an attorney who will really help you, you may just need to follow the advice of the attorney you spoke with recently who told you that the bank has no claim to the home since no title was ever issued and they have no lien so you can go ahead and obtain a bonded title. Since you really seem to like this attorney you spoke with, why don’t you ask him for a referral. He may know another attorney who is willing to help you with your case. I wish I could provide you with a more definitive answer to your question; I hope that the info I have provided helps.

On a voluntary surrender where you have a deficiency balance where the dept buyer of the original loan. Can they charge you the added fees like the machanical service contract, gap insurance difference and other fee that you purchased at time of sell. And do you recieve credit for monthyly payments already made and since it was sold at an auction due you recieve credit for payments principle plus interest paymets made. I guess what I'm trying to figure out is. I paid 428.00 a month on a vihecle kept it for a year ,turned it back in to the dealer . It was sold within that same month and I'm wondering what credits I may be able to deduct in the deficiency balance.

A repossession is going to be associated with a multitude of fees. I would not be able to guess as to what all is included in your contract. Here is how it will work now. Lets say the balance on your loan at the time of the repo was $10,000, and your vehicle only sold for $8000, then you would be still responsible for the difference in the shortfall for $2000 plus the fees and charges. Now, on the other hand, if your vehicle sells for 11,000, you will be refunded the $1000 less any fees and charges.

This is good info, but I need more. Is there a book that fully explains the how to's, all ramifications, procedures, and what if's of voluntary repossession of a house? If not, who can I talk to about it that is an expert. I live on disability and was suckered into a horrible arm that put me in a hole, and now the market has gone so low that my home has depreciated about $75,000.

I have never come across such a book, rules and procedures differ. Your best resource would be the internet, followed by your lender, who will let you know what the rules are for a voluntary surrender. You might also want to take the opinion/help of a real estate attorney in your area.

We were full-timers in a motor home for 4 yrs-our daughter was involved in an accident that has left her a Quadriplegic and due to her medical needs(she lives with us) we have to give back the motor home as a voluntary repossession. With our income all disability income-what can we expect now. Yes they know the situation.

I financed a minivan earlier this year and have not really been treated fairly since day 1. I did not find out until I had signed all the contracts and pulled the vehicle off the lot that there were issues with the van, starting with the price. I paid over $7,000 the fair market value and the fact is that the dealership knew that they had a sucker, because I had poor credit and was in dire need a of a vehicle. The vehicle came with a 90 day warranty, however within the week I had a problem; the brakes and the transmission was in need of repair. I had to pay for half of the repair work. I thought this was unfair but paid it to be sporting. Now the vehicle has totally lost the transmission and I still owe $7,000 dollars. What, if any are my options?

First, let me express my sympathy to your family for everything that you are going though. Few things are worse for parents than seeing their child seriously injured, though it is a blessing that your daughter is still with you. Given the unpredictable and unfortunate nature of these sudden changes in your family and financial circumstances, I would hope that the lender which financed your motor home will allow you to return the vehicle with no penalty. However, I fear that you may not be so lucky, and thus may end up owing a significant amount of money on your remaining loan. When a creditor repossesses (or a consumer surrenders) a vehicle, the lender will usually sell the vehicle at auction, applying the proceeds of the sale to the balance remaining on the loan. If the sale proceeds are insufficient to cover the balance owed, the remaining loan amount, called a deficiency balance, is generally the consumer’s responsibility. For example, if I owe $10,000 on a car which is repossessed, and the creditor sells the vehicle for $5,000 at the foreclosure sale, then I would be responsible for the remaining $5,000 balance. Thankfully, RVs hold their value fairly well, so I hope your deficiency balance will not be too large. Once a deficiency balance is established, you are responsible for either paying the balance in a lump sum or negotiating acceptable payment arrangements with the lender. The lender may be willing to settle the debt if you can offer to pay 30% to 50% (or possibly less) of the balance owed, though they will probably expect payment of the settlement amount in a lump sum or, at most, within a few months time. If you cannot afford to pay the deficiency balance, the creditor could file a lawsuit against you for the amount owed. However, since your income is primarily from disability/retirement, even if the creditor sues you, it is possible that it would be unable to enforce a judgment against you, as most disability and retirement income sources are exempt from creditor attachment. If you are considering surrendering your motor home, I strongly encourage you to consult with an attorney in your area to discuss the possible consequences and how you can minimize the impact. I wish you the best of luck in resolving this matter, and hope that things will improve for your family in the future.

You do have options in a situation like this. Under most state’s laws, an auto dealer must disclose any problems or defects in a vehicle that it knows about, or should have known about with reasonable inspection, to any potential buyer. If you can demonstrate that the dealership knew about the problems with the vehicle but sold it to you anyway without disclosing the issues, the dealer may be required to compensate for your damages. Also, if it did not sufficiently repair the problems with the transmission at the time that the vehicle was under warranty, you may have additional claims against the dealer or the shop which did the work. If you have tried to work with the dealership to rectify this situation but have made no headway, I would encourage you to consult with an attorney in your area who specializes in consumer rights law. Most states, if not all, have a “lemon law” which protects people who are sold substandard goods, such as your minivan. An attorney should be able to contact the dealership and hopefully settle the case with them. If they will not settle, he can file suit, if appropriate, to recover the money owed to you by the dealer for its unscrupulous actions. To read more about lemons laws, visit http://en.wikipedia.org/wiki/Lemon_law.

Please help, I live in the state of California. in August of '07 I purchased a used, 2005 Honda Accord. In July of this year I was diagnosed with a serious heart condition and have been put on disability indefinitly. As a result, I can no longer afford my car payments. I am considering a voluntary repossession but I am upside down by roughly 8,000 dollars. I understand I will still be responsible for this remaining balance. I can't afford to pay that balance either and I don't want to be sued. What options, if any, do I have besides filing for bankruptcy and or turning my car in? Thanks for your time. Sincerely, Sherry

I am sorry to hear about the financial difficulties that your health problems are causing you. Unfortunately, your story is not unique; unexpected illness is one of the most common reasons for American consumers to be forced into bankruptcy. Since you can no longer afford your auto payments, I encourage you to contact your lender to explain your medical situation and ask what, if anything, the lender can do to assist you. While I think it unlikely, the creditor may be willing to assist you by lowering your interest rate and lengthening your loan term to reduce your monthly payments to an affordable level. If the creditor is unwilling to assist you, bankruptcy may be the best choice available to you. While refinancing the auto loan may be possible, I would be surprised if you could obtain better loan terms than you already have given the problems currently facing US credit markets. A Chapter 7 bankruptcy would likely allow you to surrender the vehicle without the worry of a deficiency balance (what you would owe after a repossession), as any deficiency is normally discharged as part of a bankruptcy case. I strongly encourage you to consult with an attorney about the financial difficulties you are experiencing; a qualified attorney should be able to carefully review your finances and tell you what options are available to help amerliorate the situation. If you would like to read more about bankruptcy, you can visit http://www.bills.com/bankruptcy/. I wish you the best of luck!

my son is unable to make his payments on his truck I am cosigner and would like to keep the truck ,the loan company said for me to get it in my name and his name off the title I would have to refinance, but the loan value is less then what is owed. we are considering voleenter repoe, can we do anything different.

If you do a voluntary surrender, not only will your son's credit go down, but yours will also take a hit because you are the co-signer. A repossession is a serious matter and will have long term consequences. The only way out that I see (apart from paying the entire loan off), is if you refinance the vehicle, by paying down the loan to the actual value of the car.

I am a temporary worker here in the US since last year but I was able to loan a new car. Recently, I was laid off from work and need to leave the country in less than a month and go back to my home country due to immigration laws. I still owe the bank around 10k but I can't afford to pay it. What would be the best thing to do? This coming 2009, I will most probably migrate to Australia. Will the bank still harass me to pay the deficiency balance in my home country or will it might also affect my migration to Australia? Thanks and seeking your help.

That really depends on whether the credit card company has some way of alerting the credit bureaus about your account in the US. I highly doubt that it will affect you in any way. The creditors can only contact you at the contact information you have. all I can see happening is that your credit (in the US) will be bad for the next 7-10 years till the statute of limitations on that debt expires.

Soooo many questions...so little time.We bought a new truck in aug 2006 for my wife.she lost her job in sept of this year and we can no longer afford to pay for it and our other bills on one income.We juggled payments with our 2nd mortgage until now their both late and now have a choice of our home or our truck.the choice is easy the truck has to go.we called the lender,they won't rewrite the loan because there policy is only after 35 payments are made will they,we have only made 22 payments.Our question is will the lender settle on the balance deficiency and will we have to pay interest on the balance and if so will we have to pay higher interest due to our credit score being lower now on the balance?do they sell it at wholesale and are we better off trying to sell it ourselves?the dealer where we tried to trade it says it only worth $17000.00 and we owe 27000.00 any help is greatly appreciated.

This problem goes back approx 3 months. My wife co-signed on a 2008 Jeep Liberty. After having this veh.1 to 1/2 year my son and daughter-in-law called us from the jeep dealership in Rockwall, TX and told us they were dealing on a new Jeep Sahara Wrangler. They were able to trade off the Jeep Liberty and bought it home and went for a month and then our next door neighbor bought their Jeep Liberty from the dealership. At this time my wife kept getting calls for the Jeep Liberty. After pestering our son and Daughter-in-law for over a month, and after several calls to the dealership by our son and daughter-in-law we came to find out that the dealership paid off our son's pick up truck instead of the jeep liberty. In the mean time they sold the Jeep Liberty to our next door neighbor. Now the Neighbor will not take the Jeep liberty back till they get their $3,000 investment, our son and Daughter-in-law wants to vol repo both veh. The dealer is trying to undo both deals. Here we sit in the middle, need some advice for my wife.

You should try to sell it yourself. If you do a voluntary surrender on it, it is as good as a repossession as far as your credit is concerned. Once repossessed, they will sell of the car in an auction. Now these auctions always invariably fetch a much lower value than what the vehicle is worth. Add to it the various charges and fees that will be tacked on. How your lender will deal with the deficiency, only time will tell.

The dealership was not in a position to sell the Liberty to anyone until it was paid off and had a clear title. Since the dealer failed to pay off the Liberty as agreed and instead paid off the truck, the Liberty was likely sold subject to the lien held by the previous lender. The lender probably has the right to come and repossess the Liberty from your neighbor regardless of the fact that your neighbor put a down payment on the "purchase" of the vehicle. However, if the lender did repossess the vehicle, your neighbor would likely be able to sue the dealership for selling a vehicle that did not have a clear title. In the meantime, the lender is probably reporting the delinquency on the Liberty to the credit bureaus and damaging your wife's credit score. I do not think your neighbor has any obligation to take back the Liberty; rather, the lender is responsible for straightening out the mess it created by paying off the wrong vehicle. I would encourage your son to send any documents he received from the dealership at the time of the trade-in to the lender to show that the dealer was required to pay off the loan on the Liberty; hopefully, the lender will decide to go after the dealership for its money. He should also call the dealership demanding that it correct its mistake. If the dealership, which is the party at fault in this situation, refuses to resolve the quagmire it has created, I encourage you to consult with a consumer rights attorney who can tell you what actions you can take to force the dealership to pay off the Liberty. I would expect that the dealer will work to resolve the situation, but if it does not, you may need to file a lawsuit to force the dealer to take responsibility for rectifying this problem. I wish you, your son, your wife, and your neighbor the best of luck in resolving this mess!

I have a pontiac 2004. I have a $4000 balance on loan. Last month I spent $1500 to fix the dam car just to find it needs another $3000 in repairs. It is unsafe t drive. No dealer will take the junk as a trade so the only way I see is voluntary repo. I opened a case with GE asking them to help with the repairs (right! of course the answer was a laud NO). If I have proof I spent all these money and GE sold a piece of junk that worked only for 4 years - do i have any chance of not paying off the deficit balance? Thanks

Here is an answer to your loan question - which I haven't gotten before :) It is VERY unlikely that they will just let you out of the loan. If you return the Pontiac via an voluntary repo then they will likely attempt to sell it or scrap it and use the proceeds to pay down a portion of your loan. Whatever is left will be a deficiency balance and they will almost certainly try to collect on it. Your options are to try to negotiate with the lender to take a discount (maybe 50% off of the principal) if you can lump sum payoff what is remaining on the loan, or sue them for the car being a 'lemon' (however it is VERY unlikely, again, to win a lemon suit on a car that did run for several years). I think that in this case you just have to take your lumps, and I am sorry for that. I hope that his helps you make the right decision for your particular situation.

I too am considering voluntary repo. I have 2008 Civic that I leased when I lived in LA and needed a car. Now I live in SD, blocks from work and everything else I could ever need. I have tried to trade my car in for a motorcycle, but the bike shops don't take cars, and the car dealers don't typically have bikes. Not only do I not need the car, the payment + insurance + gas + maintenance are not worth using it once per week. My credit is already bad with a Ch 7 in 2005 and one repossession earlier this year that I need to dispute with the credit bureaus (lender mistake). If I let my car go, my credit will be totally trashed, but it already is pretty bad and my plan is to lay low for the next 5-7 years and pay off my student loans while the economy bombs. I've accumulated no other credit or debt since the BK other than the lease, which I was forced to do because of the repo on my Toyota. Should I take one last blow to my credit, and then rebuild? Since I live in SD, I can ride a motorcycle all year long and seriously reduce my driving costs, which are really standing and watching my car decay costs. Your thoughts?

Yeah, seems like your logic makes sense. Typically there are two consequences of a voluntary repo. 1 - your credit is hurt and 2 - you could still owe a deficiency balance. Since your credit is already beaten up, the negative consequences are limited, which means it is really just an economic (cost) decision. Good luck and wear your helmet :)

Last year my brilliant husband traded in my Tahoe that was almost paid off for an f-350 diesel dually that I never wanted. I knew that we couldn't afford the payments on the vehicle once we moved back into military housing earlier this year. Well, now my husband is out to sea, and the six hundred dollar payment every month is litterally half of our monthly income.He is out at sea eating and not worrying about a thing, while i am struggling to pay bills and feed myself and our 3 kids. As of right now, we owe 22 thousand on the truck, and according to blue book value, it is worth 26. Is there any way that I can sell it to pay off the loan? or do i have to turn it over and have the dealership sell it? I need to be out from under this thing. The stress is just not worth simply 'having' a truck. I would drive a beater every day so long as it was paid for. Any advice that you could offer would be greatly appreciated.

You have a few choices, but you will probably end up owing a deficiency balance since the loan is larger than the truck's value. I would recommend calling the dealer and inquiring about trading it in on a car of much lesser value, and seeing if you can get that low payment for a beater (as you described). I would suggest that typically you should not be spending half of your income on a truck payment when you have more important expenses (children, food, housing). You could also voluntarily let lender repossess the truck and then figure out a way to pay off any remaining balance that is left. Good luck.

I recently bought a 2007 dodge ram, the economy tanked and now I can't afford the vehicle anymore because my income level has went down. I called my lender to do a voluntary repo, they explained how to process works and told me I would be recieving a letter in the mail in 9 days to let me know where to take the vehicle, I haven't recieved that letter and its been almost a month, i also called to follow up, when I do, its as if I have to explain the situation all over again with every phone call meanwhile i'm not making payments and still have possesion of the car, I think they are trying to prolong the situation and accummulate more interest charges, what should I do?

Be sure to document the discussion, and send them a certified letter stating that you were told that the resolution would have taken place weeks ago, and that they cannot be charging you excess interest in the interim. You could also simply drive the truck back to the lot and vountarily drop it off, or seek the advice of a local attorney.

please help me im behind on my cae payment i owwe them 750.00 asap i dont have it right now and dont see my self back on my feet until mid jan.2009 should i do vonluntary repo or will the credit comp be willing to wait...

I would suggest calling your lender and explaining your situation. It is possible (although unlikely) that they would grant you forebearance and give you a month to get caught up. There is no question that they would rather having you pay your bills, but they are also frequently very inflexible since the original loan could be sitting in a securitization somewhere and be hard to ammend. If they will not accomodate your request and you do not need the car, then you can seek counsel from them about their process for voluntarily letting them repo the car. Good luck.

What measures can be used to collect the deficiency in the event of a voluntary repo?

That really depends on you state laws, but could include wage and/or bank account garnishments.

Please help! I purchased a 2000 Toyota Sienna in Dec, 2003 @ at 5 yr loan. Since then the vehicle is no longer working due to a motor problem. I contacted the Finance company several times, informing them of my situation and attempted to try to work something out with them, maybe a trade in, they were not willing to assist me. They were only willing to give me an extension and continue making my car payments. I notified them that I am not paying for a vehicle I can not drive. I stopped making payments on the vehicle and finally contacted them to pickup the vehicle. I recieved a letter letting me know the vehicle was sold at auction for $2,500!! Keep in mind I still 9K on my loan. I just recieved a call from the finance company letting me know that I need to payoff the 9k and if I don't they will garnish my wages, take me to court or take my income tax money. I am a single mother of 2 "head of household" and taking the bus to get to work. Please advise

Unfortunately, it is not the finance company's responsibility to keep the vehicle in working condition. I am not surprised at the price the auction netted as that is usually what happens in a repo auction. It is still your responsibility to pay the balance. My only suggestion to you is to educate yourself about the state laws pertaining to deficiency balances as even though they are threatening you with dire consequences now, they will still work with you if you negotiate with them in a proper way. Whatever you do, keep a paper trail of all the communication you have with them. Perseverance is the only thing that will work.

I co-signed for a snowmobile for a friend 3 years ago and over the past year he has missed multiple payments and is currently 4 months behind and shows no signs of paying, it is killing my credit, how bad would a voluntary reposession lower my score if it is currently at 640 because if he keeps this up it is going to continue hurting it anyways

I cannot gauge the damage on your credit in terms of the actual point drop, but I can tell you that it will have a substantial negative effect on your credit. Not only will the repossession be stated on your credit report, but you will also have to deal with the lender to resolve any deficiency balances that may arise as I am sure they will follow up with you if they are unsuccessful in recovering their money from your friend.

Hey very informative site! I will be brief.I have vol repoed my truck.It was sold.I owe $3800and have made arrangements to pay this amount.?being Will the manner i make this payments be reported so maybe it will help my credit later on.Thanks

Your credit is damaged due to the repossession already, the manner in which you make the payment is not going to help you in the short run, but making the payment will put an end to this account, which if not paid and closed, would still be reported as a deficiency balance account. Therefore, make the payment as soon as possible.

My ex husband and i had our property forclosed on in 2004 and the mortgage company closed it out and wrote the balance off in november 2005. We had a second lein on the property also and they held this open until this year May 2008 before they wrote it off. I was trying to buy a home and now since they just wrote it off instead of doing it years ago. (It has been 4 1/2 years since it forclosed) So now since they just did it in May 2008 I was told by my mortgage lender that I was going through I have to wait another 4 years to try and get a home. I have cleaned my credit up over the past few years and have a good credit rating now but that is hindering me from getting my home. Is there anything I can do or do I have to wait the 4 years to even try again now.

One thing you have to be clear about is that just because a debt has been written off by a creditor it does not absolve you of the responsibility to still pay the debt back. If, after the foreclosure sale, there were any balances on either of the mortgages then they will be reported on your credit report. I suggest that you check the status of the same by obtaining credit reports from each of the 3 credit bureaus. Once you check on the reports, you should be able to see if the accounts are still showing any balances. If they are, then I'm afraid that these will be looked at quite negatively, till the statute of limitations passes on this debt (which could be anywhere from 4 to 8 years). As more time passes, the negative effects should be minimized. But, what would really help is if you were

I had a Chapter 7 bankruptcy last year. Now they are coming to repossess a snowmobile that was purchased with a credit card. That debt was discharged in bankruptcy. Talked with the repossession company and they said that they received an order from the bank that there was over $1000 due. Did not recieve a notice from the bank either.Do not know where to go from here?

If you purchased the snowmobile with a credit card, they have no authority to repossess it. You should check in your bankruptcy filing as to which accounts were included in it. If you have a discharge statement, you can present that to the repossession company.

Hello - I have a vehicle that I owe $10k on, but have been long-term unemployed. I contacted the lender that I wanted to do a voluntary surrender as I am four months behind & can no longer make payments, get current, or afford insurance. They have not contacted me back. They have stopped even the collection calls. What do I do with this car? I can't sell it with a lien, I don't want it since I'm not paying on it & it's not insured. I just don't know what to do with a car that has a lien that they appear to refuse to take back?

You should visit the office of the lender and then handover the car after proper documentation. The lender has stopped all collection efforts on this because they have the ability to report the debt to the credit bureaus, and also have control over the title of the car, placing you in a situation to deal with it yourself. In any case, you should be aware that you will still be liable to pay the loan back.

Thanks for the prompt reply Bill! Yes, I am aware that I'm still on the hook for the balance. I honestly just feel bad that I still have a car that I'm not paying on & want to give it back to the "rightful owner" and let them recover something even if it's a partial amount at auction. Thanks, I'll take your advice and drive it up there & drop it off to them.

My ex husband and I bought a car in 2006 I never wanted to buy the car in the first place because it was to much money! He pressured me into buying the car because he had kids he said they needed room. I had to get rid of the car I loved that was way cheaper! I divorced him because of cheating and I got stuck with the car and payment he is on the loan as the primary I tried making payments the best I could to keep my credit in good standing however I got put to part time at my job and no longer could afford the car. I called the lien holder and told them to please just take it! How can this affect my credit and is my ex still responsible since he got me into this in the first place!

Depends on whose name the loan is under. If your ex-husband is the primary loan applicant and you singed as a guarantor, your credit will still take a hit too because your SSN was taken into consideration while the loan given.

I owe B of A almost $300k on a motorhome I just purchased 6 months ago. I put $80k cash down. It is worth over $300k but no one is buying expensive motorhomes these days. I am sure if it went to auction, it would probably only get $200k. I have perfect credit (800+). I also have a home with B of A. I owe $200k. It used to be worth $400k but now is worth $175k if that. I have no credit card debt, no car or other assets. I have only $10k in savings. I have $100k in 401k. I own no other property or have any other money or debt. I just got down sized and can only make my house payment. The reason I had a house and RV at the same time is that I was selling house and was going to live in RV right before the financial crisis hit hard. Now cant sell house, or sell RV. I am in Florida. I read all the question and responses but I think that this question has not been answered. If I turn in the RV, and the bank sells it for $100k less than I owed, I know I am responsible. But can they take my 401k? Can they lien my $401k? I know there will be a judgement of the difference, but I need to know if they can do anything with my 401k? I have tried to sell house and Rv but in this market, no takers. I am very very close to missing a RV payment.

No, creditors cannot touch retirement funds such as your 401k savings, in their efforts to collect on the deficiency balance.

I am from India working here on temporary visa and I have to return home urgently and will not be returning to USA again. I have a loan for a car. Will voluntary repossession affect me in India as far as deficiency dues are concerne? Or is it just going affect the credit score here in US?

It will only effect your credit score here. There is still no such thing as a "credit profile" in India yet.

Okay, I thought I co-signed a car but come to find out, I am the primary on it. The car was totaled by a friend while in their possession. When I got the car I had it for about 2-3 months and it was never registered with the dmv. Everytime I called up there to see if they had the tags ready, they would tell me that they never received the information from the buy here pay here that I got the car from. Long story short, a payment was never made. The car lot that I got the car off told me not to make a payment until I got the tag and according to their contract I had to get my tags within 30 days from purchasing the car and since I was over my 30 days they told me it voided their contract. (question - is this correct?) okay moving forward, I didnt pay the note because I was told to wait, because of no payment for 3+ months, the finance company wanted to repo the car (which was fine with me because it was the worst purchase ever!) I told the finance company what the guy on the lot told me and they said that was fine. I never drove the car because the car wasnt for me, it was for a buddy - well that buddy let their friend take the car our of town. I told that to the repo company and told them as soon as they get back in town - they could come and get the dreadful car... that happened. I didnt hear anything from the finance company for about 2 years when I was served for a lawsuit. I didnt file an answer (didnt know I had to) but I showed up at court (of course) and they got a judgment on me because I didnt file an answer so the judge didnt want to hear what I had to say. This "buddy" disappeared so this is why they came after me. The attorney's office that filed the garn said if I could find the buddy then they would stop going after me and go after them - I told if I could find them, I wouldnt be in this predicament. I told them my story and that I didnt drive the car, what the car lot told me, tags not coming... yada yada.. well after the judgment I didnt hear from them again for about 2-3 years in the form of a wage garnishment! Well now after I have dazzled you with my story my question is - is there a way I dispute this garnishment to have my story heard in court and maybe have this decision reversed and/or dismissed? Is there a loop hole somewhere that states if the car was never registered at the dmv then it didnt really belong to me?

Because you signed the note for the vehicle, you were responsible for payments to the finance company, regardless of what the dealership may have told you about the tags, etc. I know that you were relying in good faith upon the dealerships statements, but your contract was with the finance company, so the dealership really had no authority to defer your loan payments while you waited for the tag. You were required to make payments as outlined in the finance agreement, and since you did not make them, the finance company had the right to repossess the vehicle, auction it, and pursue you for a deficiency balance (the amount of the loan minus the amount received at repo auction). The fact that the vehicle was being driven by your friend does not absolve you of your obligations under the loan agreement; that is why creditors want co-signers—so they can pursue someone who they think is more likely to pay the debt in case of default. Unfortunately, I doubt that there is much you can do to challenge this debt at this point. You signed the loan, and you were responsible for making payments or making satisfactory arrangements with the finance company. The creditor was within its rights to sue you, obtain a judgment, and pursue you for payment of the judgment, including garnishing your wages. You should probably consult with an attorney about this matter to determine if your state “lemon laws” or any similar statutes may help you in resolving this situation, but given the amount of time that has passed since the judgment was entered, I doubt that there is much that can be done other than paying the balance owed. Of course, you could consider filing for bankruptcy protection to stop the garnishment and (hopefully) discharge the debt. If you are considering bankruptcy, I strongly encourage you to consult with a qualified attorney in your area to discuss the options available to you.

I purchased a 2004 Jeep Cherokee in 2006 and have always been on time with my payments until last year June, I lost my job. Even after I lost my job, I continued to make payments from my savings and made use of the deferrment option that the finance company offered me. Now my savings have been depleted, I am still not working and it's a choice between rent and car payment. Needless to say,the car must go. I am 45 days late now. I owe $14000 on the loan and the Kelly Blue book values the car at $9910, in excellent condition. I would like to avoid a voluntary repossession because of the effect it will have on my credit and on my relative who co-signed for me. They offered to lower my payments by $100, but I still cant afford that. I offered to pay $100 a month and they told me that's too small. I told them I will have to do a voluntary repo then. Instead of making arrangements to get the car, everyday they are calling for me to make good on the loan and saying that my relative will also have to give her consent to voluntarily turning in the vehicle. I already discussed the possibility of her taking over the car and the payments, but she also was laid of from her job and cannot afford it. Can she refuse to the voluntary repo and force me to pay and can the company refuse the payment I am willing to make? If I continue to pay what I can afford can they still repo the car?

Your lender can repossess the car if you do not make the complete monthly payment as agreed in the loan terms. The co-signor cannot stop a repossession from happening on account of a missed payment. Your lender cannot stop you from making a payment that is less than the monthly payment, but as stated earlier, if your payment is less than the monthly payment, then they can repossess the vehicle. A voluntary surrender is the same a lender repossession (when it relates to the effects on your credit) . If repossessed, the co-signor's credit will be hit as well.

My husband purchased a doublewide mobil Home and he is now deceased. I did not sign on it. I tried to keep up with payments but it came to the point where being a widow with only social security to live on I did contact them in the beginning and told them of his passing. They finally repoed it 6 months ago and it is still sitting on my property. They came and took it apart and I had spent over 5 grand on a nice porch which I dismantled from the home that was bolted and they and the first thing thing they did was loaded up my porches and told me that they knew the law and the porches belonged to them.What should I do block my drive way until they return my porches. I can't agrue with 4 or 6 red necked guys to one 0ld lady. Please help

I recommend that you talk to a lawyer licensed in your state to determine exactly what the law is an what rights you have to seek compensation for the property that these repo men took. Generally speaking, when a vehicle or mobile home is repossessed, the lien holder can take possession of any improvements to the property that are not easily removed or are integral to the operation of the vehicle. For example, if you had put a new stereo system in your car and it was repossessed, the lender would have the right to sell take the vehicle with the stereo in it, because the stereo is an integral part of the vehicle. However, if you had unbolted and porches from the mobile home and they were not longer an integral part of the structure, most states’ laws would not permit the repo company to take them. I encourage you to consult with an attorney to determine your rights in this situation; if your attorney thinks it appropriate, you may be able to file a lawsuit against the repo company and the lender for the cost of replacing the porches which they took. Since you are elderly and on a fixed income, you may qualify for free or reduced cost legal services through your county Legal Aid Society; a good resource to find legal assistance in your area is available at http://www.ptla.org/ptlasite/links/links.htm. I wish you the best of luck!

Hello, I'm in a situation with my vehicle. Dont know which way to turn. Bought the vehicle 2 yrs ago the warranty expired awhile ago which i paid $1500 for the warranty. I figured with that much money they would give me more then 6 months of coverage. Well the transmission went on the vehicle which costs $1500 to fix. Dont have that money. I'm current with my payments. I owe $6,000 left. Car is only worth $2,500. I'm thinking of voluntary repossession i think Please help........

Walter, you are in a situation like millions of Americans since cars depreciate so quickly and loans don't go down as fast. If you are willing to give up the car you should call the lender and discuss with them that you would like to voluntarily return the vehicle. It is HIGHLY likely that after they sell your car that they will try to collect on the remaining loan balance, so be prepared for that. Even after returning the car you could still owe $4,500 based on your estimations. Alternatively, maybe you can negotiate with them to keep the car and keep making payments in exchange for them fixing the transmission. You never know! Good luck Walter.

I bought in 2008 nissan quest when my credit score was really low,and I ended up paying an interest rate of 18%...Back when I'd purchase the car my income was great,but now my job is not doing great at all and I work with commission sales..I would like to do a vol.repo...But I do not know where to start..my credit score is messed up already so I don't care about my credit score. my car is worth $15,000 by kelly blue book,and I owe $28,000...I can not afford this payment and i am single mom of 4 kids..I am scared but I DON'T HAVE A CHOICE..PLS ADVISE

Yudith, doing a voluntary repossession at this time will not absolve you of your responsibilities to pay back the amount that you owe the lender. After a vehicle is repossessed (voluntary surrender or otherwise) the dealer will sell the vehicle at an auction. As you state the the vehicle's value is not enough to cover the loan, the lender will still pursue to collect on the balance of the loan which will be termed as deficiency balance. This balance will be reported just like any other unsecured debt. Before you surrender your vehicle, I suggest that you speak to the lender to see if they will give you some payment relief or re-structure the loan.

iheard in ny if you have a repo the bank has 30 days to sell it. after the 30 days they can not come after the diff.

In 2005 purchased a motorhome for $143,000 w/ $16,000 pay'mt with the expectation of paying it off quickly from the sale of sub'd lots. Unfortunately this did not occur due to the downturn in the economy. Also due to stock market losses I cannot keep up the payments as I am retired and living on a gov't pension and SS. If I let it go back can they collect the deficency by liening my real estate or what little cash I have left in the bank, my pensions, a small annunity or personal property. I reside in the state of Michigan. Thanks

Can my mortgage company say No to a vountary repo? I am not behind on payments, but have to move due to lack of space in current home (growing family). Cannot sell due to upside down, and don't think i can get out any other way.

I am not aware of any such law in New York state. Like all states, a repossession sale must take place within a reasonable time period, but I do not know of any rule requiring that sale take place within 30 days. For a breakdown of NY repossession laws, you can visit http://www.lawdog.com/states/ny/repo.htm. I wish you the best of luck!

They cannot force you to stay back. Once you stop making the payments, they will start the foreclosure process. You should talk to them about a short sale option.

The laws about what a creditor can do to recover deficiency balances vary from state to state. You can get a quick summary here: http://www.bills.com/collection-laws/. Most retirement income is protected from creditor garnishment. In order to place a lien on your home or garnish your wages, the creditor has to get a successful judgment from the court. If it ever comes to that situation, you can always explain your situation in court and figure out a payment plan to avoid a lien being placed on your home. it is difficult to guess what recourse the creditor will choose, the best thing you can do is research online about other people's experience.

Hi, I am leasing a 2008 Honda accord for almost a year. I got into school and have to reduce my hours at work in a couple of months. I traded in my 03 accord to get this vehicle and rolled over about 5000 into the lease. So, as you know, I am upside down on the 08. I was thinking about vol reposing the car, but my bf tells me I will be responsible for the WHOLE pay off. Is he right or is it really true that the lender will sell the car in auction and I will be responsible for the deficiency balance? What are my chances?? Help.....

Yes, you will be responsible for any deficiency balance that may arise. Not only that, a repossession will hurt your credit real bad, so I would think twice before doing so.

I just recently purchased a vehicle from an independent auto loan company with a very high interest rate. They supposed to help people with bad credit to better their credit in 18 months. My paper work is still in "pending" until they verify my references before the send it over to their financial company for them to verify. I had the car only for 2 days then I turned back it back in because i wasn't happy with the car and the interest rate. I didn't speak to no one other than the person I have the key to and left. I came back to the office at the end of the week to discuss my issue with the contract and car. The owner said that I signed the contract and it is binded until everything is verified. He didn't give me back the car but I was trying to work out a way with the owner about ending the contract and I pay whatever fees for the two days of me having the car. I also asked for a copy of my documents that i didnt get from them when i first signed for the car. The owner refused to give me a copy. I left the place unhappy again. I still didn't get my car back but I'm suppose to pay on this promissary note on the down payment. They haven't said anything that the car will be a voluntary repo. I'm not sure if they will put it down as a voluntary repo but I don't know what I should do at this point.

When you sign an auto loan agreement, you are generally bound by the terms from that moment forward. In all states in which I have done business, there is no "cooling off" period for the purchase of a vehicle, and the buyer is responsible for the entire amount due under the finance agreement from the time it is signed. The fact that you were unhappy with the vehicle would not normally be grounds for you to unilaterally void the loan agreement. Since you have turned in the car, the lender will likely treat it as it would any voluntary repossession--it will sell the vehicle and apply the amount received to your loan balance. If the sale price does not cover your loan, you will likely be responsible for the difference, called a deficiency balance. The account will probably be reported as a repossession on your credit report, which is a significant black mark on your credit history. I know that it seems somewhat unreasonable that all of these negative consequences could result from a two day lark with a lemon of a car, but hopefully this experience will make you be more careful in the future when entering into contracts of any kind. I wish you the best of luck in working something out with the lender and hope that you can find a way to amicably resolve this dispute.

I am in a situation that is literally making me sick. I have ALWAYS paid my bill on time, usually over paying to get the loan paid off quicker. After the economy taking the hit is has in the past few months I am out of work and broke. I can no longer pay for a piece of heavy equipment I bought just last year. After 3 months of rigorously trying to sell it or even lease the darn thing, I have no other choice but offer a voluntay repossession on the loader. I AM SICK! After all these years of doing the right things now I am facing this...WHAT CAN I DO???? I am not sleeping and I am crying all the time knowing what is ahead for me. Any advice would be greatly appreciated.

If you cannot afford to keep it any more, you will have to face the inevitable.

I have a 2007 jeep liberty that is currently in a lemonlaw case, I just found out that the manufacturer (Chrysler) is going bankrupt, should I wait to hear from my Atty. or just voluntary repo the car. I know all the repercussions. My question is, can the manufacturer now include all the cases in their own bankrutpcy case?

Yes I bought a van over a year ago, I paid faithfully to my Finance Co. on time all the time. They sold my loan to another Finance Co. Then the calls started, on my cell phone 3-4 times a week, we want to update your info, I update, 3 days later we want to update your info, over and over again, The loan amount because of my bad credit was way too much anyway, so I told them to come and pick up the van, they said they will not, sent certified letter return receipt got it back, they still refuse to pick it up. Have since removed insurance and changed plates to new vehicle still it sits in my yard, they no longer contact me, landlord wants it removed. Don't know what to do can't do anything in Massachusetts without a title. ANY IDEAS?

WE would like to surrender our RV, My wife looses her survivor benefits from her prior husbans this year. All we have is my pension and social security. WE are Mich residents but she owns a home in Az as well. The RV is in my name alone. Can they put a lien on her home, being its in a community propery state. WE have tried and tried to sell the Rv but the banks are not giving out too many loans

You should absolutely wait to hear from your attorney, or alternatively, call your attorney and ask his advice about what you should do with the vehicle. Chrysler's bankruptcy will likely have little affect on your obligations regarding this vehicle, and you should not make any decisions without clear guidance from your attorney.

You need to go talk to a lawyer to help you determine the best course of action in MA. Every state's laws regarding the surrender of title (on the part of the finance company) are different. Depending on MA's laws, you may be able to apply for a new title at some point, allowing you to take ownership without the finance company's lien. The bottom line is this, you need a lawyer who can provide you with state-specific advice on this matter ASAP.

If your wife owned the home in AZ prior to your marriage, then no, RV finance company could not place a lien on the home in AZ, as it would not be considered community property (since she owned it prior to the marriage). However, if it was purchased after your marriage, the lender may be able to place a lien on the AZ property if it obtains a judgment against you and then domesticates it's judgment in AZ. The likelihood of the creditor taking such drastic steps is, I think, very unlikely. I don't think you have much to worry about, but you should still probably consult with an atty licensed in AZ just to make sure the property is not at risk.

My wife leased a call here in CA before we were married. Only her info is on the lease. I know they cannot go after me since contract was signed before our marriage. We cannot make payment so are thinking about having it repossessed. Can we just walk away and just take the credit hit on her end? We just bought a new car under my name so we have no intentions of paying back anything on her lease. Thanks for you reply.

Please see here for consequences of voluntary surrender of a lease: http://www.bills.com/blog/voluntary-surrender-of-lease/

I have a 2003 16x80 River Birch moble home. I am having a hard time making ends meet and can no longer afford the payments. The home is not being lived in and is just sitting there. What can I do. I have tried selling it but no one wants to pay what I owe on it . I can't rent it because it is on someone else's property.

First, you should try to sell it at the best price you can get, as per the market. You could then fill in for the balance and pay off the loan. If selling it does not work, then your only other option will be to do a voluntary surrender to the lender. This will count as repossession, and will hurt your credit. You should contact your lender and inform them that you cannot afford to make the payments anymore and for them to take possession of the mobile home. If repossessed, they will auction the mobile home and apply the proceeds of the auction sale to the balance of your loan. If there is any balance left, bear in mind that you will still be held responsible to pay it back.

My husband and I purchased a park model trailer (classified as an rv) due to county restrictions we can no longer live in it without getting arrested. I am now living with my parents with our 2 young daughters while my husband is living in a tent 100 miles away for his job. I have talked to the bank about voluntary repo since I have not been able to sell it for the $56,000 owed, and noone wants to purchase it because you cannot set it anywhere. I need some good advice. I cannot pay the deliquent amount and fees if we voluntary repo it, but I can't pay for a trailer that I cannot live in. If I don't voluntary repo it do I have to pay the deliquint fees?? Thank you

hello. my step dad bought an 08 dodge ram pickup in oct. 07. he died in mar of 08. my mom living on social security and va benefits monthly, can't make the payments anymore. (700.00). she told them of voluntary repo. they keep calling and harrassing her. what can they do. she lives on a fixed income.

I married 5 years ago. My husband had bad credit. I bought a motorcycle in my name. The marriage did not work out and I cannot pay for the motorcycle. I have had the payment deferred, and have also spoken with the bank about refinacing. Creditors are constantly calling my house. I tell them I cannot make a payment and I cannot drive it to them so I cannot bring it to them. What am I supposed to do? Also, what will happen if I cannot pay the difference after auction. I am not being funny, but if I could make a payment I would. My husband left me with a lot of debt and I do have an appointment with a bankruptcy lawyer. How will this affect the motorcycle?

Your Mom should could try and send them a cease communication notice, you can look this up on Google. More importantly, your Mom should contact a qualified attorney to sort out the financial matters of your late step Dad's estate. You should know that all the assets and liabilities of your step Dad will be passed on to the legal heir, which I am guessing is your Mom.

As the bike is in your name, you will be held responsible for any difference after the auction(also called a deficiency balance). If and when the motorcycle gets repossessed, it will reflect on your credit profile. If you decide to file for bankruptcy you could probably include the deficiency balance in the filing.

Kourtney, I am sorry to hear about your predicatment. Unfortunately, your only options are to either sell the RV and apply whatever you receive to paying off (or paying down the loan), filing bankruptcy (which sounds like it might be an option), and voluntarily delivering the RV back to the lien holder and letting them sell it and then try to collect any remaining deficiency balance. I'd recommend contacting a bankruptcy attorney in your area.

My wife purchased a new car to get me mad after 3 weeks she decided to drop it of at the dealership would this be considered a voluntary repossion. We can afford the payment and have money in the bank for it could they come after the money in the bank.

I am just about certain that if you contact the dealership and confirm that you intend to continue to make payments and that you want to keep the auto, they will just about certainly let you keep the car. I'd have a chat with a marriage counselor maybe after you pick up the car :) Good luck Al. Bill

My boyfriend and I decided to purchase a car 2007. He would be the one signing for the car though.With us being young we were just eager to get a car and get on the road we had been eyeing this one car at a specific dealership and without doing any research or looking anywhere else we decidedto go and purchase this car (which was a 2006 Dodge Intrepid). We put $1800 down on the car and were able to ride off the lot in our car.Well a block down the road we started hearing a banging sound coming from under the hood as we drove it got louder and LOUDER.We turned around and went directly back to the car dealership where we got apologies and were told tthat this was a big mistake the cars engine was SHOT completely and that they were under the impression that they had taken the intrepid w/ the bad engine off the lot and replaced it w/ the same kind just a fixed one. Well obviously this didnt happen and we were assured that this was a big mistake, that they were a good dealership and would never try to weazle us out of our money.They then agree to give us another car (like a rental)that we could use while they cleaned this mess up.Well weeks went by and we called every other day to check and even went to the dealership but nothing.No call and no new car so we decide to go see whats going on AGAIN! We get there and we get another story about how they wouldnt want to give us this car back and they just wouldnt feel right (trying to make it look like they cared) and so on.They tell us they have a great 2002 Chevy Malibu w/ a great engine, no problems, and that its cheaper gullibleand thinkingwereood hearted we took the car.Ten on everything really went downhill.Only a few months into getting the car the problems started one after the other the water pump, the gas pump, the HEAD GASKETS even though each time we took the car back and had it repaired (by these people) paid all our money in full to get it fixed and kept up on every car payment things kept getting worse.Every couple months or so the car would strangely cut off and we couldnt start it for weeks at a time we tried to take it to the dealership they didnt know what was wrong. We had others look at it and never really got a solid answer from anyone we even had a diagnostics test done on it annd it said the car was fine but we kept having this problem ;longer and longer amounts of timeand more frerquent. Eventually the car would always start and we could ride it again but it would always just happen again over and over.Now our car is sitting in the yard and hasnt moved in over 7 months we had a mechanic come and look at it and to our surprise the car needs AGAIN a new gas pump.AND new head gaskets and you know what that means yes our dealership took our money and only put a band aid on the problems but never fixed them.They fixed the car so it would work for a while but the problems were never fixed!!Not only that we still havent found anyone who knows why the car just shuts off for weeks at a time and doesnt start. We've heard everything from bad wiring to its a hurricane Katrina car (whatever that means).my question is right now we just want to give up and get rid of this car we've paid ontime every month 300$ a mont for our payments and have never even been late but enough is enough we cant even use the car let alone get itsarted we want to just do a volntary repo because we feel like there is no hope and nothing else we can do w/ it. Is this our only option my boyfriend really doesnt deserve for his credit to be smashed when we have the money and can pay for the vehicle we just dont know what to do. Is there anything else that we can do besides the voluntary repo????

What if you do have a car you can pay for and have been paying your monthly bills ontime every month but the car hasnt worked in over 7 months you cant get it to work and you cant find anyone to fix it. Even though you dont deserve a voluntary repo is this a situation where you should to get rid of the car if you cant do anything with it and your wasting your money???

Nikki - You may have a claim for a "lemon" so you should check to see with an attorney if you could possibly rescind the purchase and get your money back if it never worked. Check on the lemon laws in your state. Good luck. bill

I really need some advice. We just bought a 2002 Grand Prix on May 23 we have not made the first payment yet. We bought the car AS IS however before signing the contract the dealer agreed to fix the air conditioning. We dropped the car off on May 26 and didn't receive it back until May 30, I immediateyly noticed that my car display was no longer working, I called the dealership and informed them that the car was not returned in the condition that I left it, at first they said "Well just don't look at the display", then later agreed to fix it. I also noticed that the heat in the car was no longer working also. I contacted the dealership and they said for me to drop off the car and they will repair it. During the following week we noticed a lot of things that seemed to be popping up wrong with the car. (ex. brakes not working properly followed by ABS and TRAC lights coming on, car begininng not to start). This in turn led us to believe that more was wrong with the car which is going to result in many repair bills, also several situations has arose that financially we are just not going to be able to pay for a car. We are considering on doing a voluntary reposession. I'm torn because (1) I know my husband's credit will be damaged for at least 7 years and (2) I know we are still going to have to pay a deficiency balance. What should we do?

Try to avoid a repossession. First, talk to the dealer and see if they will buy back the car. Be polite but firm. Perhaps you could trade that car in for an older model on the dealer's lot that has has a better reputation for reliability or fewer miles. You may be out a couple hundred dollars on the deal, but that is far, far better than causing any damage to your credit report. Second, if the dealer doesn't want to trade or buy back the car, try selling it on your own. Again, you may lose money on the deal, but that's better than the alternative.

Hi Dennis: You say that you want to surrender your motorhome to the bank. Go to https://www.bills.com/debthelp/debt/ to see if debt consolidation or debt negotiation is right for you, which it might be if you are not behind on your payments. - Bill

I agree =avoid repossession

I have to allow the bank to have my motorhome back, since this will mess up my credit and I will file BK then should I bury all my credit cards before I file. I assume I will have to wait to file BK untill judgements have been passeddown otherwise they will not be included. I have a house morgage, how will the BK affect it (and my car loan ( I want to keep the car)

Gloria, you are not alone as RVs depreciate rapidly and it's easy to get upside-down if your finance an RV. Bankruptcy may not be your only option. You may be a candidate for either debt negotiation and settlement, or debt consolidation. Here is a great resource to get started on debt negotiation and settlement: http://www.bills.com/debt-negotiation-and-settlement/ Start here to learn more about debt consolidation: http://www.bills.com/debt-consolidation/ For a free online debt consolidation quote, visit: https://www.bills.com/debthelp/consolidate_debt/ Regarding the mortgage and car loan in a bankruptcy, those are questions to ask a BK attorney in your state. Each state has different exemptions. Generally speaking, you can keep your house as long as you continue to make the mortgage payments, and a vehicle. However, as I mentioned, there are particular rules for each state.

We have voluntary repo d our RV in 2005. Since my Husband and I on Social Security the Bank said it would close the account. The credit report stats account closed with 0 balance. Now after 5 years the contacted us to collect the difference of $ 37,000.00. We are living in Florida. Can the size our Social Security and small IRA. Thanks

The statute of limitations (SoL) on collecting a debt in Florida is four years. See this page for a listing of your rights by state: http://www.bills.com/collection-laws/ Generally speaking, the SoL starts when you stop making payments. You mentioned that you surrendered your RV in 2005, but not when you stopped making payments. I am writing this reply in 2009, so the SoL on collecting your debt may end this year. Regardless of when the SoL expires, the creditor can continue to ask you for payment. The SoL is a defense for you to use that bars collection of the debt. Regarding your retirement income, creditors cannot seize/garnish your retirement income. However, if you co-mingle your retirement income with funds from another source, then all of those funds can be seized. Make sure you keep your retirement income separate from money you may receive from gifts or other sources.

recently i fell behind in my payments on my toyota highlander by a few months. toyota contacted me and asked if i would be interested in a deferement/extension plan. the delinquency would be placed at the end of the contract. the account would no longer appear as delinquent. all i would need to do is continue paying the monthly fee as if nothing happened. the only catch is i have to have their insurance adjuster inspect the cart to ensure that the car qualifies (in case their is substantial damage to it). is this a real request or are they trying to lure me into giving back the car?

I think the real question is does Toyota's financing company make money by finding ways to make their customers keep up their monthly payments, or by repossessing cars? My guess is that Toyota can build all of the cars it wants, and what it needs is your money. If you've been maintaining payments regularly until this recent rough patch, my guess is Toyota's offer is legitimate. However, if it is a trick to nab the car then I ask you to return here and tell us what happened.

Well, it was a ruse by Toyota's repo company. I admit that I could have been more careful, but that's what happens when working 70+ hour work weeks to catch up and not double checking their story. 'Their 'required car inspection to give me an extension' was an outright lie. The repo yard lured me out to reposess the car. Since this is my first repo, I was told by the repo agent and Toyota (who I immediately called) that I can pick up my car within 15 days if I wire them the amount due, including a fee for the repo. I have since wired the money and am going to pick up the car. So, watch out for any offer to place your outstanding debt at the end of the loan. Since I need the car for work, I had no choice but to pay the past due & get it back. However, I am extremely motivated to pay off the principal and not deal with Toyota again, since I was making payments (though late) and communicating with Toyota. I will be able to catch up on my bills, but If I am not able to, quick enough, then I might file chapter 13 with a cramdown on the car amount. That way, I would get my car back, owe only what the car is worth and also obtain protection, while I catch up. then Thoughts anyone?

Wow, this surprises me. I thought more highly of Toyota, and I am disappointed the company chose to tell such an outlandish lie to a customer who although behind on payments, showed motivation and intent to work with the company. Thank you for alerting us to this tactic. Regarding your ideas for handling your debt, obviously I can't comment because I don't know anything about your financial situation. I would caution you not to act in haste. Yes, Toyota betrayed your trust, but that doesn't mean you should alter your budget or financial plan to spite the company.

I'm not trying to be shady, but I have found myself in a horrible situation which will cost me a lot of money that I don't have... I have a 2006 Toyota RAV4 limited 4WD that I have had nothing but problems with. I originally leased the vehicle and bought the platinum extended warranty, thinking I was set should anything go wrong. After a year of payments I re-financed and and consolidated credit cards as part of the loan, so I am really upside down on the loan. Last week my transmission went completely out at 75,000 miles and I discovered that my PLATINUM warranty expired at 60,000 miles. So...I have a $650 monthly pymnt, and a useless car that needs a $4,600 repair. I haven't got the means to make it happen, so I was considering buying a new car before I go into voluntary repo. I have not been late or missed any payments thus far, but I am caught between a rock a a hard place and don't know what else to do. AT this point I HATE the RAV4 and would like to take a sledgehammer to it. Please advise...

First, you may not qualify for another vehicle loan due to your debt/income ratio, so your creative thinking may need to be directed elsewhere. Second, I'm not surprised you got nowhere with Platinum Warranty Corp. -- the company ceased operations in late 2005. The Toyota factory warranty expires at 5 years or 60,000 miles. Third, $4,600 seems high even for a transmission replacement. My guess is that this is a quote from a Toyota dealer. You might be able to get a better deal from an independent shop that will install a used or rebuilt transmission. Finally, try to avoid a repossession. Repos wreak havoc on credit scores and are costly.

Me and my husband bought a car in 08. We brought a 2002 sebring. Well a month down the road we started have air problem, then all the belts were no good. Traveling out of state one day the engine went out, fuel pump and the belts. Once we got it all fixed the car still doesnt run. Should be buy a new car and then get a voluntary repo because the payments on the sebring are not even worth it because it doesnt work.

Very rarely do I think anyone should allow their vehicle to be repossessed. Bite the bullet and fix the car. Then, if you choose to, trade it in for a model that Consumer Reports considers more reliable than average. Going this route will be far cheaper in the long run than dealing with the inevitable deficiency balance you will face with the Sebring.

i volenteerarly repossessed my van almost two years ago and now the finance company is making calls sayin i owe 19 grand but a guy i talked with said to never pay what is asked, because i gave the van back and dont owe them anything.....so which is true???? please help

If the guy you talked with was an attorney in your state and you are his client, then believe him. If he's not an attorney, then the legal advice he gave you is suspect. On the other hand, do not believe legal advice from collections agents. Their advice is usually incomplete or wrong, and is always self-serving. An almost inevitable result of repossession is a deficiency balance, which as explained above, is the balance remaining on the loan after the finance company auctions the repossessed vehicle. The former owner of the vehicle is liable for the deficiency balance. If you believe that you are not responsible for the deficiency balance, take all of your documents regarding the purchase of the vehicle, the repossession, and the deficiency balance to a consumer rights attorney in your state and ask him or her for their opinion. An attorney's time is not cheap, but if you have a heartfelt belief you do not owe $19,000, it will be money well spent if you are correct.

What are people thinking when they purchase something on credit, knowing they can't afford the payments but sign the contractual agreement anyway? Don't you know all this negative debt accrued by the finance companies has made the economy what it is today? Stop buying things you can't afford!!

In general, I agree with your message. Some people make purchases that a neutral observer would consider ridiculous. It is difficult to have any sympathy for the willfully ignorant or those who don't learn from their mistakes. However, there are unplanned and unexpected instances that occur in life that make it impossible for prudent, careful people to repay their debts. These folks need our encouragement support, and understanding because anyone can be blindsided.

my husband and i are dealing with a bank. We have told them we are giving the car back. We know that we are still going to owe them money after they sell the car but it will still be less then what we owe them. When we first got the car we were told that we could go back in a year and that we could refinance. We went back in after a year and were told they couldn't do it. We tried to sell it or to sell it back to the company where we got it per suggestion of Wells Fargo and all has failed. They still want us to pay the payments we are behind. My husband has talked to them but they refuse to listen. Can they garnish wages instead of taking the car back? Bottom line is "WE CAN'T AFFORD THIS $550.00 A MONTH PAYMENT" Please advise

The creditor has plenty of cars, and really wants your money instead. Regarding garnishing your wages, the creditor is several steps away from garnishing your wages. For the creditor to take that option, the creditor would need to first file a lawsuit against you, and then win. Next, it would need to ask the court for an garnishment order. These take time, which gives you an opportunity for further negotiation with the creditor. To learn more about the collections process, read "Collections Agencies, Collections Laws and Your State's Statute of Limitations." Before contacting the creditor again, I recommend reading "Debt Negotiation and Settlement Advice."

I have had a vehicle for about 3 years now that I've been paying (way to much might i add) on and have never been super late and don't owe them any back payments. I had to refinance my loan but get someone else to co-sign for the refinance so the payment would go substantially down. I moved out on my own and with the job market as it is I am having a hard time making money. I cannot afford repairs/registration (which is up at the end of this month) for my vehicle and have nowhere to store it so I won't get fined and the only thing I can think of is a voluntary repo. So I really have a few specific questions. 1) Will they do this because of that reason or does it have to be that I owe them money? 2) I know my credit will be affected but what about my co-signers credit? 3) From reading other comments and answers I understand that when they sell my vehicle if it doesn't cover what I owe (which I believe is more than it's worth) I'll still owe the difference????4) Is this the only thing I can do? I can't think of any other way to deal with this issue and I only have until the end of the month.

1) It is impossible for me to predict with certainty what a creditor will do or when. When answering reader questions, I try to stick to the law because that is documented in statutes and case law. Some creditors are aggressive about their rights and spare no time in repossessing a vehicle. On the other hand, I received a message from a reader today who claims he or she has not made car payments in three years, and wants to know what to do if the creditor has abandoned the vehicle. 2) Your co-signer is liable for the car payments if you stop making them. In other words, if you stop making the car payments, you are obligating your co-signer to make them. If neither of you make the car payments, both of you will see damage to your credit scores, and both of you are liable for the deficiency balance if the car is repossessed. 3) See No. 2. 4) Talk to your co-signer now. Explain the situation. Perhaps you can work out an arrangement where you both contribute to the payments for a short time while you get yourself back on your feet again. The alternative is that when you stop making the payments, the creditor will start hounding the co-signer for the payments. By working out an agreement with the co-signer in advance (which I realize may not be a pleasant conversation), you demonstrate foresight and consideration for your co-signer, which may prevent the situation from becoming a disaster for both of you.

my son has had his hours cut at his job and taken on a second job but cannot afford the payments on his vehicle, he is considering a voluntary repo, I know that the bank will charge you the balance left after they sell the vehicle, and that they can also put a lein on your property until it is paid, but can they legally have your wages garnished or does the court go by your income and debts before allowing it? The bank did lower his interest and payments to try and help and he had been paying it but with his hours being cut he just can't make it, He has a baby and one on the way and this has really put him in a bind.

To learn more about the collections process, read "Collections Agencies, Collections Laws and Your State's Statute of Limitations." The right for a creditor to garnish wages depends on the state laws where your son resides. See the Bills.com page "Collection Laws and Statute of Limitations" for state-specific information. The amount of garnishment depends on the defendant's income, and the amount exempted by the defendant's state of residence.

My husband and I purchased a new car last November 2008, since then he had to medically retire from his job of 23 years. He is on home oxygen and other equiloment to help him breath, he stops breathing about 47 times in a minute and that is very scary. He also hard heart surgery and the dr. caused damaged to an internal organ by accident we were told. Well due to the high costs of his equipment and medications and the insurance is now going up in january 2010 and I am only working part time. He does gt a retirement check but by the time we pay everythhning we have no money . We have not yet been late on the car payment, but we want to turn it back in as a voluntary repo. If we could keep it we would but the money is not there and he does not want to file bankruptcy. What do you think our chances would be on this.

This is not meant in any way to sound uncaring, because I have great sympathy for you and your husband, but consumer law does not have an exception for debtors who become ill and cannot afford to pay their bills. If you return the car in a voluntary repossession, you and your husband are liable for the deficiency balance. You may not need to declare bankruptcy. I recommend you consult with an attorney in your state to discuss your rights and liabilities. Ask the attorney if wages are exempt from garnishment, and how to make your husband's disability payment immune from collection.

I saw your post to someone else and helped him with some questions about repossession.I am pondering getting my car repossessed in the next two months and was wondering if you could help me with a brief overview and maybe a contact to an attorney is CA. I have called two attorneys and left messages but no one seems to have the time to call me back. I got a Mercedes in 2007 and I was 20 years old and dont even know how I qualified for it. It was for $24,627.74 but for a 73 month term. I pay $503.72 every month on time but just a few weeks ago my bf kicked me out and I am now having to live on my own and having to pay rent and the rest of my bills.,,. With only making about 800 each pay check I cant keep doing this.I am barely making ends meet... I hate to turn it in and get my credit score turned upside down but at this point I am at a loss. Not only that but Ive tried to refinance it but no one will refi is cause it has over 70000 miles on it and its passed older then 2003. So then my next step was to trade it in but they would only give me 3500$ for it MIND YOU I OWE STILL $18015.33 and have a 13.5 interest rate. I then wrote them a letter expressing how I could not afford it and if they could re negotiate my interest rate but they said no. So they said I need to just make double payments but LORD... I can barely make the 503 payment. So I feel like Ive done as much as I can at this point.I just don't know how this will hold up and if someone can help me with knowledge on how this will affect me and if its the right thing to do or the only thing to do. I have 46 more payments and the car is worth 8000 on a good day. I'm soooo upside down and to top this all off it has 107,000 miles on it and needs new tires and a tune up (around 2500 more dollars that I cant afford) so I am hoping you can help with a resolution or direct me into the right location to get some help on advise. I also noticed it you voluntarily reposses it its a lot less cheaper. I don't want to owe late fees or storage fees so I was thinking of paying on the first of the month and turning it in that day so they have 30 days to sale it or put it in an auction so I wont have to pay a bunch of extra fees....

Alas, I do not have a secret solution to your problem. Regarding your idea for making a payment and then dropping off the car. I do not recommend that. Use the car until the end of the month, then turn it in. I doubt if the creditor will give you any credit for making the payment during the time the car is in their possession. I recommend you review the message thread reader Latoya and I are having in "Auto Loan Default." At present, Latoya is farther along in her negotiations with the creditor than you are. I suggest you read the thread not only for the information about repossession, but to see how Latoya developed a plan, and through persistence is working towards a resolution. At present, I do not know how successful she will be -- no one wins in a repossession except for the repo-man -- but I commend Latoya for dealing with a tough situation actively. I recommend you try to work through the situation in the same manner.

I want to keep my car. Please help! In purchased 2007 PT Cruiser. I've made payments every month and have 46 payments to go. Unfortunately, my license and registration were suspended. As a result, my insurance dropped. While waiting for my suspension time to end, I parked my car in front of my home and continued to make payments. The trouble came when the Philadelphia Parking Program towed my car. I found out that it is against the law to have an unregistered or uninsured car parked on the street. To get the car back, I must show proof of insurance, registration and license. I cannot do this because my suspensions don’t end Dec 09. The company holding the car told my only option is to contact the finance company and have them pick up the car. I have not contacted the finance company yet because I’m afraid when they pick up, they will consider it as repossessed. According, to my finance agreement the company can reposes the car if it doesn't have insurance. I don't want to loose my car or ruin my credit. Do you have any recommendations? Have you ever heard of any of situation where the company would pick up the car and then give it back to the person?

With the understanding that I'm not an authority on the Philadelphia parking system, I think the answer is self evident in your question. First, get your insurance current. Second, get the registration paid. Third, bring a friend to the impound lot, pay the appropriate fines, and pick up your car.

I remarried in 2004. At that time I filed bankruptcy and my husband took on all the credit needs in our home. A few years later my credit cleared up and in 2007 I was able to purchase a truck in my name for his use. We are now in a position that my husbands income has fallen and we can no longer afford the 699.00 payment. I have an SUV and he has a car. We dont need the truck but we do need the 699.00 to support our living expenses. We have discussed voluntary repossession for the truck However I hesitant in moving forward on this because I know how hard it was to repair my credit due to the bankruptcy and the negative credit rating that I would experience again for another 7 years. We are upside down about $4,000. Do you have any suggestions?

If I had a solution to this problem I would patent it (if possible), and make millions. I do not have a clever solution. The only suggestion I can offer is review the conversation Latoya and I are having in "Advice on auto loan default."

I lost my job 6 months ago and finally found another one a month ago. Granted it's about a 30% pay cut. So we can afford our bills, just not the credit cards. We are going through a chapter 7. We have 2 cars, a 08 Altima lease and a 03 Escalade worth about 9K with 16K owing. It is having maintenance issues atm and we can't afford to keep it. We want to either lease or buy a used car to replace it. Would it even be possible to lease or buy a 3rd vehicle with 90 Debt to income level? Or should we wait till after the chapter 7 when The bank picks the car up? Would we owe the difference in debt after the BK? What would are rate be after the BK? Don

Your questions are best answered by your bankruptcy attorney. He or she has a complete view of your financial picture. However, given the information you shared here, I doubt you will find a finance company willing to lease a vehicle to you today.

we are thinging about voluntary turning in our truck. we wanted to find out what else besides our credit will it affect. will it affect our childrens finacial aid for school?

It is impossible for me to answer your question because you do not mention what type of "financial aid" you or your children are receiving. If, for example, a child is receiving a scholarship due to academic or athletic excellence, then I doubt a parent's financial distress will have any affect on the scholarship. If a child has their own student loan, then a parent's distress will have no affect on their loan.

I lost my job 6 months ago and cant pay for my RV that is upside down about $20000. Bank wants me to turn it in but the insurance has lapsed because I have no money should I buy temporary insurance and gas on credit card to tow it four hours one way and hope work comes around to pay back credit card or let them come and get it?

I assume the item is question is a travel trailer or fifth-wheel because you say you need to tow it four hours to the bank. As the article above suggests, voluntary repossession is preferable to an involuntary repossession because of the lower costs. I suggest you clean out the trailer, repair any minor items that need attention, and return it to where the creditor directs you. Yes, it will cost you fuel and insurance, but your costs will be lower and you will control when and how the trailer leaves your custody.

Hi Bill, bank gave me a closer location but now I can't find any place to insure me to drive it there. :( any suggestions?

Ask the insurance company that insures your other vehicles. It may give you a one-way, one-day policy gratis or at very low cost.

Hello from Florida, I will try and make this quick, I am debating on whether I should continue to hide my 2 trucks or turn them in. The economy killed my business! I had great credit score of 795 before it crashed. I sold heavy equipment worth $300-500k per machine. When the banks stopped lending to our clients for financing, it killed us. I had personal guaranteed many loans for the business. Neither everything has been repossessed, the business is closed, I had 20 employees that I had to let go. Before all this happened, I had bought in my name, 3 pick up trucks for the business. I had to stop making payments on them earlier this year, they repo'd one earlier this year, I still have 2 hiding out. I have lost 2 homes, defaulted on all my credit cards during this period and had to sell my personal vehicles in order to eat. GMAC calls everyday, I don't answer, I have changed my mailing PO Box. It looks like my have a new business starting shortly which may allow me to get caught up on them. I look at this way, at this point, my credit is ruined, I am have judgments against me, if I hang on to them a few more more months it can't due anymore damage then has already happened to my credit. It wasn't may intent to stiff any one, it just has turned out that way. The banks stiffed my business and left me holding all the debts! Any suggestions? Florida.

I realize that hindsight is 20-20, but when you organize your next business see an attorney in your state who has experience forming corporations. You could have saved yourself a great deal of trouble had your business's corporation assumed the liability for the debts. Also, had you seen an attorney when your present business was winding down you could have filed for bankruptcy and protected your home and a personal vehicle from the reach of creditors. You need to surrender the vehicles. Eventually the creditor will ask the court to order you to do so, and if you do not you will be held in contempt, and if you ignore the contempt order you may be held in your county jail until you do.

Can CCCS help get an interest rate modification? Have '05 Venture minivan, Owe 10K, KBB saying about $6,500, Auction run would be around $4,200. No problems with car. Current on payments but at 13.5% with a 630 FICO. No unsecured debt at all (credit shot from '04 BK7). Current on mortgage which is good 5.5%. Tried applying at my bank but they won't touch it due to BK, illegitimate open collection (which I don't plan on paying) and upside-down value. I don't care about credit anymore. No cash in hand - No buying. Trying to be debt free other than house. Have zero in savings. The princess has no concept of budgets. Trying to find a way not to walk away from her, the kids and debt obligations to live "underground". Thanks...

Consumer Credit Counseling Service (CCCS) is set up for credit card debt, so CCCS will not help you resolve the deficiency balance. If you allow the vehicle to be repossessed -- voluntarily or otherwise -- your estimated deficiency balance of $5,800 ($10,000 minus $4,200) will be a unsecured debt. You can resolve the deficiency balance with a debt consolidation / negotiation firm. Go to the Bills.com debt relief savings center to get no-cost quotes from pre-screened service providers.

I have a auto that had a defective engine and just blew on me. Cost of a new one is $9500. I still owe $7,000 on my loan. Saab/GM will not fix the problem even though they were well aware of it. I am one year over the "Special Warranty". I need a car and can not afford two payments. I am planning on buying a new one and doing a voluntary repo on the dead one. I really don't care about my credit, since I am older and will never be buying another vehicle. What do you think?? Buy the new car first. then stop payments on my old one ???

I think I see potential flaws in your logic. If you cannot afford two car payments given your present income and expenses, how do you expect to qualify for the second car loan? The other car dealer will run a credit report, look at your income and expenses, and sniff-out your plan immediately. There is one item you did not mention -- the deficiency balance on your dead Saab if you allow it to be repossessed. How will you handle that expense? Obviously, I think your idea is flawed for both reasons. This is not a good situation, and there is no winning solution. Either find another mechanic who can do an engine-swap for less than $9,500 -- which is likely -- or sell the car as-is to an auto-parts boneyard and eat the loss.

I leased a Chevy Tahoe in Jan 08. Later on that year in sep I filed for chap 7 BK. I included the vehicle in the BK. I was hoping to keep the vehicle because I figured I would have a hard time qualifying for another one. now in Jan 2010 I find my self I cannot afford the payment on the lease. I'm in construction, and contractors are paying "very very" late. and so it has been messing up all my finances. this has been a problem that has been getting worse since late 08. I have contacted GMAC to hope they could some how help, maybe renegotiate terms, or refinance into a loan instead of lease. Since I have 24 more moths left on the lease they would add residual value, plus remaining payment. That would put the payment even higher. So no help. I told the that it would be beneficial if we redid some kind of loan that would lower my payment otherwise I have no choice but to do a voluntary repossession on the vehicle. I told the guy at GMAC I filed for BK after I leased the vehicle, and that the vehicle was in the BK. The guy on the phone told me I would be responsible for the remaining payment, and any other fees, because the BK was so long ago. I'm just wondering if they can come after me for those payments?

First, do not believe legal advice from customer service representatives at creditors. If you have a question about your bankruptcy, such as reopening it to add your lease, talk to your attorney. Second, you were wise to call GMAC to discuss any possible options for your lease payments, and it is unfortunate GMAC could not offer you anything useful. The GMAC customer service representative was correct in stating that if you return the vehicle either to the dealer or some other location that GMAC designates, you will be responsible for the lease balance and early termination fees. Fortunately, the lease lease balance and fees are an unsecured debt that you can put into a debt negotiation program.

We filed bk ch 13 in Jan last year, and converted to ch 7 in July. We noted to surrender our motor home in the bk, the bk was discharged last October and BofA has not contacted us to pick up the rv. How long does it typically take for a bank to retrieve the rv? We are not sure what to do...we are still paying insurance, etc.

My brother got locked up and left his car with other family, now I have it because of my space. But it's been over a few years and somehow people been showing up and calling about infor on the car. Someone even showed up and told my sons you are him and we will be back. After talking with my brother he said to go ahead and let them have it, but I don't want this company or people to still come to my home and bother us. We only kept it so he could pay for it when got out, but that will take a longer time. This is Calif., can I park it on the street so they can take it or should i dropped it off at the dealer?

Kim: First, contact your attorney to make sure the motorhome was included in the bankruptcy filing and was included in the discharge. Second, ask your attorney if he or she has received any correspondence from Bank of America regarding the motorhome. Third, contact Bank of America what its instructions are for your placing the motorhome in its possession. Finally, continue to pay the insurance on the motorhome until the bank takes possession of the vehicle and the title is signed over to the bank.

Jean: Contact the finance company that wrote the loan for your brother's vehicle. Explain the situation and that you wish to drop-off the vehicle at a location it designates to reduce the repossession fees. Then follow the finance company's instructions. The finance company may "require" you to sign a document when you drop-off the vehicle. Be extremely careful about doing so, as in this situation the finance company may try to make you a guarantor on your brother's loan. A kindly customer service representative may try to cajole you into signing such a document because doing so "is the right thing to do" or ask "don't you want to help your brother out?" Resist giving yourself liability for the vehicle loan. You have no obligation -- legally or otherwise -- to do pay your brother's debt.

my 20 yr old son bought a car with the understanding hat his friend would pay him back. His friend lied about having a job and now the car is back in my son's posesionl. The car was purchased just about 30 hrs ago. Can he return the car to the dealer? Will the dealer be obligated to take it back under buyer's remorse?

I am not aware of any state with a "cooling-off" statute for vehicle purchases. You did not mention your son's state of residence so I cannot review your state's laws. Therefore, do not take what I just wrote (or anything else you read online) as gospel. I assume the vehicle was previously used. If your son bought the vehicle from a dealer you may want to suggest to him that he return to the dealer and explain the situation. He may be able to return the car under these circumstances by paying the state licensing and taxes the dealer would otherwise have to eat, plus whatever commission was paid to the salesperson. This may seem unfair, but your son can chalk this up to a life-lesson. If your son bought the vehicle from a private party he should sell it and whatever loss he incurs he should bill to his "friend." If the vehicle was new, well this will be a very expensive lesson, indeed. New vehicles lose 10-20% of their value the moment they leave the dealer's lot.

Hi Bill. We have a 2008 Toyota Avalon and are concerned about the recall issues. The balance owed and the blue book value are about equal currently. We're disappointed in Toyota's handling of the entire issue and no longer feel safe driving the car. We're tempted to just take it back to the dealer and call it quits. I suppose this would be considered voluntary repossession but with all of Toyota's problems do you think they'll really be in a position to squak much?

One safety-related recall on your vehicle will not be an effective argument in court for breaching your loan contract. Were this one more in a series of recalls, then if your state has a lemon law this recall might be another piece of evidence that the manufacturer sold you a defective vehicle. Allowing a voluntary repossession for the reason you stated would be unwise financially for the reasons mentioned in the article above. However, if you really dislike the vehicle and the market price is equal to the balance of the loan, then have the recall work done, and sell the vehicle.