Need advice on auto loan for family member

Anonymous · ‎11-06-2015

Yes. I know I should NOT have. But, everyone has moments of idiotocy that haunts us.

My middle daughter wanted a truck. We looked and looked. Everytime one came close she lost it for this reason or that. One dealership didn't log her deposit. The bank too a day too long to get back to her and she lost out. This went on for about two months. Bad luck. So she found one. It was outside what she could finance. She is 20 and has always paid her stuff responsably. I told her I would get it in my name and then we could just pay the bill and insurance. We all know what I am going to say next. It has been four months and she hasn't. She and I have spoken many times and though I don't want to ruin a realationship being the bank, I also know I CAN'T afford the bill long term. She lives at home with us. The bill isn't past due, as I've been paying it monthly. I just listed it for sale in our community and on craigslist. Here is my question:

This was purchase more as a buy here/pay here the ford dealership has in our area. I already had two good loans. 17K I took out for my own personal expedition in winter this past year and one for my father who lost his job and needed a car when he finally got a job for 6K. That one is two years old and will be paid off on time with no missed payments in 12 more months. My father has always been a man of his word. So, the dealership said it reports but it is like in house financing. I said no problem. I signed. If...... I can't afford this payment anymore (a thought that is taking better form with each month) what happens to my credit report? This payment is taking what I normally put into savings and a IRA. Is in house financing going to report a repo if I give it back? If so, how does that affect my credit? I've a mortgage for 10 years with no issues ever, two capital ones that never carry a balance and have 3K each, discover with 5K that never carry a balance, and a small unsecured loan with my credit union for house repairs that is a year old with all on time payments and will be done in two more years. I am getting the feeling with each talk that paying this bills isn't going to happen and I have been dupped.

StartingOver10 · ‎11-06-2015

What I have seen with some of those BHPH type in house financing companies is this: if you pay on time, your account is not reported to the CRA's. However, the minute you miss a payment they report the bad debt, repo the vehicle and get a judgment against you for the defaulted amount plus fees (lots of fees). They repo super fast too. My personal opinion on those type of places is they make more money off the judgments than on the vehicles!

If I were in your shoes, I would do exactly as you are planning to do - sell it and bring money to the closing if you are upside down.

Does your daughter know that you are planning to sell it? Is she working? I don't understand how she thinks this truck is free. Hopefully you can either get your daughter to see the light and make payments to you or get the truck sold right away and not have to bring too much to closing. If she were my daughter (I have two) I would make her pay whatever deficiency between the price you get and the loan amount.

Anonymous · ‎11-06-2015

She was all for paying it and then the month after we secured it.... Her boyfriend convinced her to start to save so she could move in with him and his family. They don't like my rule that Sunday - thursday she has to be home by midnight cause i get up at 4:30 for work. And its not like if something special was going on i wouldnt mind... But they want to do it every night...So she is saving all her money and only paying something in her name like her credit card and phone bill.

I told her i was going to sell it but i dont think she believes me because she knows to get rid of the loan i would have to pay it all off. However.... I am very serious. We sat down and spoke for days to make sure everything was clear. She doesnt have to oay rent if she paid her car payment and insurance while she went to school. Her boyfriend has way too much influence on her right now but she is twenty and there is little say.
I dont want to be bothered like this. I knew if something happened I would have to pay for a whike but this isnt the way it was suppose to start. I dont know much about in house financing so i thought i would ask. When they ran my credit the dude was having trouble getting me financed for three car loans. Even co signing was still hard cause her credit wasnt established enough. He said my score was 721 but my debt ratio to high as i had just secured my loan for 17k two months before and having three car loans was far fetched. I had hoped this would be as good as it was for my mom and dad. I put my dad on the loan at my credit union so the payment would show nice rebuild. He was downsized after 35 years and went through the two yrs of unemployment until he found someone who would hire him at his age. I dont regret that.. But this im somewhat annoyed with.

EddieK · ‎11-06-2015

You have every right to be annoyed and you're handling it way better than I would've. Sell it as soon as an offer that you like comes in. Let her figure out how to get from place to place without a car. Seems like that's the only way she'll learn. You've done more than enough.

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Anonymous · ‎11-07-2015

Is she still driving the truck?? If she is.. First take the truck from her and don't let her drive it no more.. If u don't mind me asking what's ur income and what's ur total loan expense every month not including the truck.. What's the payment cost of truck?? Also where u got the loan from is pretty much lying to u.. Ur daughter is 20 with income and she have credit cards.. Even if she have credit card for 6 months with on time payment she shouldn't have a problem with getting a loan for it unless the vehicle is 50k and her income is 1000/month

bada_bing · ‎11-07-2015

@Anonymous wrote:
Is she still driving the truck?? If she is.. First take the truck from her and don't let her drive it no more.. If u don't mind me asking what's ur income and what's ur total loan expense every month not including the truck.. What's the payment cost of truck?? Also where u got the loan from is pretty much lying to u.. Ur daughter is 20 with income and she have credit cards.. Even if she have credit card for 6 months with on time payment she shouldn't have a problem with getting a loan for it unless the vehicle is 50k and her income is 1000/month

+1

For several reasons, she shouldn't be driving the truck. You don't want the wear

and tear and more miles on the odometer. You want to get it into detailed condition

to have it for sale. Ethically, it isn't her truck.

Take the keys.

+

850 FICO8 since 2015, Thanks MyFICO - 5+ years since last HP

Anonymous · ‎11-07-2015

I'm a tough love mom. I'd take the keys and put a for sale sign in the window.

If she is saving money to move out, paying only the bills in her name and not paying you back, I'd give her a short deadline to move in with this boy and at that time I would pack her stuff up, put it outside so they could pick it up in his car.

She is taking advantage of you and you do not deserve that.

Anonymous · ‎11-07-2015

I "repo" the truck a few weeks ago. For everyone who was asking... my husband and I make 100K together. Our outgoing monthly expeses are just shy of $1,800 per month depending on what we spend on credit cards for us. House pymt is 450. My loan payment is 400. I took 3 years to pay off 17K. My husband and I both agreeed that pinching and paying would be better than dragging it out. I know many of my friends said to take a seven year loan on it.... but that wasn't in us. We'd rather not go to the movies a few times a month and pay the loan off quicker. Gas for both veichles 250. All utiltilies total 575 (includes verizon bill and home internet bill). We don't have a water or sewer bill where we live. One-third of each pay check goes into savings, and I put another 200 into an IRA. There is a very large age gap between my husband and I and in recent years he insists so that (we assume) he passes well before I will, I am taken care of. The only monthly variable is our credit cards which we keep paid off. Granted the Victoria Secret card sometimes takes a bite out of me. lol.

We tend to take only one vacation per year and we save for that and have fun. Othewise, we are into finding fun things to do that are not always expensive. I love to cook... so we tend to eat well. Steaks and raw veggies, but we save were we can and don't waste our money. Kind of like our expedition. I kept my explorer that had died after 300,000 miles. We have manage to rebuid the engine together over the summer. So I have it as an everyday car and it will keep the milage on my expedition down. I am truly shocked as this is not how we raised her. It makes my father nervous now.... he calls now everytime he makes a payment. I keep telling him he doesn't have to call when he pays the credit union. He has been doing exactly what he was suppose to. Not like her. It is just causing extra stree.

The credit union would have only approved her for a loan up to 6K. The f-150 was 10K and she put 1000K down. So, that was why the decision was made to put it into my name. Along with the insurance. Selling it will hopefully rid of us this payment soon. I know she is mad and so is her boyfriend but I don't care. Welcome to the real world. When you don't pay your bills this is what happens.

Anonymous · ‎11-07-2015

@Anonymous wrote:
I "repo" the truck a few weeks ago. For everyone who was asking... my husband and I make 100K together. Our outgoing monthly expeses are just shy of $1,800 per month depending on what we spend on credit cards for us. House pymt is 450. My loan payment is 400. I took 3 years to pay off 17K. My husband and I both agreeed that pinching and paying would be better than dragging it out. I know many of my friends said to take a seven year loan on it.... but that wasn't in us. We'd rather not go to the movies a few times a month and pay the loan off quicker. Gas for both veichles 250. All utiltilies total 575 (includes verizon bill and home internet bill). We don't have a water or sewer bill where we live. One-third of each pay check goes into savings, and I put another 200 into an IRA. There is a very large age gap between my husband and I and in recent years he insists so that (we assume) he passes well before I will, I am taken care of. The only monthly variable is our credit cards which we keep paid off. Granted the Victoria Secret card sometimes takes a bite out of me. lol.

We tend to take only one vacation per year and we save for that and have fun. Othewise, we are into finding fun things to do that are not always expensive. I love to cook... so we tend to eat well. Steaks and raw veggies, but we save were we can and don't waste our money. Kind of like our expedition. I kept my explorer that had died after 300,000 miles. We have manage to rebuid the engine together over the summer. So I have it as an everyday car and it will keep the milage on my expedition down. I am truly shocked as this is not how we raised her. It makes my father nervous now.... he calls now everytime he makes a payment. I keep telling him he doesn't have to call when he pays the credit union. He has been doing exactly what he was suppose to. Not like her. It is just causing extra stree.

The credit union would have only approved her for a loan up to 6K. The f-150 was 10K and she put 1000K down. So, that was why the decision was made to put it into my name. Along with the insurance. Selling it will hopefully rid of us this payment soon. I know she is mad and so is her boyfriend but I don't care. Welcome to the real world. When you don't pay your bills this is what happens.

Why the hell is the be and ur daughter mad?? Do they not understand what they r doing?? She's losing the trust of her parents... If she ever need help the be isn't going to be the one to help... It will be family that help. I'm surprise the credit union only approved her for 6k unless income isn't great... U should also have a talk with daughter... Why would her bf ask her to save her money and move in with him and his family?? So she can pay for the expenses.. She shouldn't need to save like that unless she's planning on buying a house which doesn't sound like they are.. Few weeks ago u took car from her?? I would of taken it the first month she missed her payment. Not being able to make ur car payment cuz u wanna save ur money isn't an excuse to not pay.. If lost job or something and can't pay its different

StartingOver10 · ‎11-07-2015

ecunningham, I think you are doing the right thing. She might be one of those that has to 'fall down' first before she gets it.

You and your husband sound like you have done well for yourselves - congratulations. It also sounds like your daughter knows how to push your buttons, like most kids/semi adults do. Let us know what happens when the truck is sold. I bet she gets it then...hopefully.