voluntary repossession

[Anonymous]

Hello all,

I am strongly considering voluntary repossession on the car that I bought 6 months ago. I lost my job and I am currently one month late but still under their grace period. Ford motors is not even reporting this account on my credit report for some reason. What is the process for voluntary repossession? I owe 2k more then what the car is worth. I am 21 years old and currently in school. With a payment of $350 plus insurance it comes to over $500 which is something I did not consider when I first bought the car and now paying for my mistake. At this point its either I keep going to school or keep this car and I do not want to drop out. How do I go about this?

P.S. I dont have parents or relatives that could help me out.

[Anonymous]

Repossession won't eliminate the debt.  When they reposses, they sell the auto at auction then come after you for the difference.

So, if you owe $2k more than it's worth, that is the difference when selling the car.  At auction the difference will be even greater, so you could end up owing $4-6k after repossession, which they will come after you for the difference.

I suggest you sell the car and pay the $2k difference, this will give you the least detrimental effect.  If you don't have $2k, go to your local CU and talk to them about a personal loan.  Sell some stuff if you can.  Get a part time job if you can.

[MattH]

---

@Anonymous wrote:

Repossession won't eliminate the debt.  When they reposses, they sell the auto at auction then come after you for the difference.

So, if you owe $2k more than it's worth, that is the difference when selling the car.  At auction the difference will be even greater, so you could end up owing $4-6k after repossession, which they will come after you for the difference.

I suggest you sell the car and pay the $2k difference, this will give you the least detrimental effect.  If you don't have $2k, go to your local CU and talk to them about a personal loan.  Sell some stuff if you can.  Get a part time job if you can.

---

Agreed, original poster should do the utter totality possible to avoid a repo, and whether or not it's a voluntary repo makes no difference in the credit impact or the deficiency judgement for the difference between what they fetch at auction and what is owed.

[Anonymous]

is your account currently overdue?

If not call Ford Immediately and request to defer a payment or 2. I am not sure if you can do this if the account is behind.

What kind of car is it?

2 months should get you to classes being over and you being able to find work.

have you filed for unemployment? 

Shop insurance, see if you can lower it

Pizza delivery?

See about what lifestyle changes you can make immediately to scrape by on. You may be in a better position to delay a semester of school, get a job, and get caught up then if you just try to voluntary repo and live life.

Since you have no parents or family a voluntary repo will kill you on getting another car for YEARS.

[llecs]

Ditto to everyone, and coming from someone who went through a repo, don't do it. Radically change your lifestyle to get this taken care of. If I had to do my early 20s over again, I would have dropped out of school sooner and focused on a job and earning income. Besides, you could always go back later.

Like usmc5855 mentioned, delivering pizzas could easily net an extra 800 after taxes.

As John hinted, you will owe the difference and their value of the car at auction is a heck of a lot lower than what you could sell it for now. Then comes the CO, the judgment, garnishment, etc.

[MattH]

---

@llecs wrote:
...Radically change your lifestyle to get this taken care of....

---

I think llecs means, "learn to tell wants from needs."  At the current stage of our lives my wife and I can and do spend money on many things that we do not need, but in the early years of our marriage when both of us were in graduate school we had to pinch every penny.  And one of the jobs I did in that period to make ends meet was as a delivery driver and dishwasher for a Steak-Out restaurant.  Some evenings I would go through the same police sobriety checkpoint six or seven times...

[llecs]

In our case DW and I had to do a 180 in lifestyle so as to redeem the car and make good on future payments. Money never was an issue for us. We were at a point that we'd rather chase pleasure (vacations, travel, entertainment, hobbies, sports, etc.) and have some fun than make a payment. The only way we could prevent that from happening again was to change our we handled our money and that meant staying at home vs. going out, and was painful to do so. It was no wonder that our FICO scores while starting this repair process were in the low to mid 500s.

ETA....just saw the Steak-out link. I bet tips were better. I'd be in trouble if they had one here.

Message Edited by llecs on 05-02-2009 11:45 PM

[MattH]

---

@llecs wrote:
In our case DW and I had to do a 180 in lifestyle so as to redeem the car and make good on future payments. Money never was an issue for us. We were at a point that we'd rather chase pleasure (vacations, travel, entertainment, hobbies, sports, etc.) and have some fun than make a payment. The only way we could prevent that from happening again was to change our we handled our money and that meant staying at home vs. going out, and was painful to do so. It was no wonder that our FICO scores while starting this repair process were in the low to mid 500s.

ETA....just saw the Steak-out link. I bet tips were better. I'd be in trouble if they had one here.

Message Edited by llecs on 05-02-2009 11:45 PM

---

 When I worked at Steak-Out, tips varied wildly.  The most reliable tippers were female undergraduates, for some reason.  Fortunately for me, unlike many retail establishments they did NOT take bounced checks out of my pay so long as I had followed the prescribed policies like checking ID.  I had heard many restaurants did take bad checks out of servers' pay so was glad mine did not.

Edited to add: within the delivery area of the Steak-Out where I worked was a nationally-known diet clinic surrounded by several budget motels that mostly catered to their clientele.  Whenever I made a delivery to some really huge customer at one of those places I would suspect they were cheating on their diet.  I saw all kinds of people in that job, one little old lady was a regular customer and very generous tipper but whenever the temperature was below about 75F she would tell me I should dress more warmly which I found a little irritating.

Message Edited by MattH on 05-03-2009 12:09 AM

[Anonymous]

disregard my rant, I decided to keep making my payments, hopefully I can refinance later. With all the 0%APR offers now, my 10.9 seems very steep.Lesson learned.

[Anonymous]

Still wondering what kind of car you have

And as I said once you get "caught up" you can defer a payment or two