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.