Crashed Car = REPO!!

[Anonymous]

Hi all.. I found these forums to be very useful and just wanted to say thanks for sharing all of your advices and stories. Now, I would really really appreciate it if you can help me with my personal problem:

In 2006, I bought and financed a new Ford Focus with an 18% APR for 5 years.. Recently, I crashed my car and like a big dummy I was without insurance so i had what i deserved, a TOTALED vehicle!! Fortunately, no one was hurt.  Unfortunately, I had $6-7 thousand dollars worth of repair to get my car back to shape.  During the time, I owed about $6,500 on the car with only 18 months left of payments.  I decided that it wasnt worth fixing so I sent it to the impound to dispose of it. Bad move.. I got a call from Ford Credit saying that if I dont take the car out of the impound, they will take it out for me but I will be charge with a "reposession" mark on my credit report.  After explaining to Ford Credit that the car is totally damaged and that it is of no use, she explained to me that in the contract Ford has the right to take back their vehicle if the buyer damage it and blah blah.. I NEVER miss a payment and am still making payments.. i dunno what to do!!! please HEELLLLPPPP!!

[Anonymous]

You need to finish paying the car off. There is no clause that lets you off the hook when you total the car. Your lender did not choose for you to drive without insurance, you did. And since you had no insurance, they can also accellerate the pay off by demanding to be paid in full within a short amount of time. This happened to a co-worker. No insurance, totaled the car and they asked for payment in full, gave her 30 days to come up with it. They do this since there is no longer a collateral on thier money they lent you and they aren't into carrying an unsecured loan. She of course did not have the full balance so they garnished her wages to the tune of 25% per pay check.

[Takunda1]

---

@Anonymous wrote:

Hi all.. I found these forums to be very useful and just wanted to say thanks for sharing all of your advices and stories. Now, I would really really appreciate it if you can help me with my personal problem:

In 2006, I bought and financed a new Ford Focus with an 18% APR for 5 years.. Recently, I crashed my car and like a big dummy I was without insurance so i had what i deserved, a TOTALED vehicle!! Fortunately, no one was hurt.  Unfortunately, I had $6-7 thousand dollars worth of repair to get my car back to shape.  During the time, I owed about $6,500 on the car with only 18 months left of payments.  I decided that it wasnt worth fixing so I sent it to the impound to dispose of it. Bad move.. I got a call from Ford Credit saying that if I dont take the car out of the impound, they will take it out for me but I will be charge with a "reposession" mark on my credit report.  After explaining to Ford Credit that the car is totally damaged and that it is of no use, she explained to me that in the contract Ford has the right to take back their vehicle if the buyer damage it and blah blah.. I NEVER miss a payment and am still making payments.. i dunno what to do!!! please HEELLLLPPPP!!

---

If the vehicle is totalled, you are required to payoff the loan immediately. The reason.. the company no longer has collateral on the loan they gave you. So if you don't want them to pick up the vehicle from impound you need to payoff the loan ASAP. I would get a personal loan, hoping with a lower APR than your current car loan and pay this thing off.

When your vehicle goes to impound, the impound place is required to contact the lien holder and let them know they have their vehicle. At that time its up to the lien holder to either pick up the unit or  abondon it.  If you pay it off then the impound place can just take it and chop it up for parts.

[Anonymous]

oh my gosh u guys.. this is why i love myfico forums so much! thank you both for your answers. I totally had no idea they would want the payment in full. I feel so much better in my decision now and will keep this forum updated on the outcome! Thanks again!

[Anonymous]

Just remove the car from impound and keep it until paid off.  However, now that you have notified them of the "total" they may not accept that alone.  The loan was collateralized by the car.  The contract requires you to maintain insurance and to keep the car in acceptable condition.  Failure to do so allows them to accelerate the loan and demand full payment since they no longer have an asset they could sell to satisfy the loan.

In addition, allowing the vehicle to go to impound will result in you being fined or charged for the impound and storeage charges.  If you fail to pay, this will have consequences possibly including a warrant for arrest and a lien on the vehicle (causing title issue and notice to the lien holder).

The point:  if you just want to pay off over time....keep a low profile, continue to maintain minimum insurance coverage (loan requires this) and don't send the auto to salvage (which you cannot do without legal title and lienholder release).