Dodge buy-back not covering full loan amount...

[Anonymous]

Hello,

Dodge is offering to buyback my vehicle for $12,500(do to safety recall) but i owe $15,000 on loan...which is perfect i hope, i need the installment loan to continue on my credit report to help with a good FICO balance....

My question is, after dodge pays $12,500 that will leave me with a balance of $2,500 i have to pay back, once this happens will my monthly payment still remain the same or will it be substantionaly lower?

I would like for the loan to continue with the remaing 40 month i have left on the loan but with a super low monthly payment.

I understand i could just pay the remaining $2500 and be done with the loan but i really need the installment loan to help with my FICO score.

Thanks folks! I would appreciate any ideas you could throw my way.

[StartingOver10]

If they are doing a buy back, aren't they going to require the title as a condition of the buy back?  I would think so and you can't deliver the title without paying off the loan.

As to the $2500 difference, it won't help your score if you don't pay it. If you need a very small installment loan take a look at this thread

http://ficoforums.myfico.com/t5/Understanding-FICO-Scoring/Installment-tradeline-utilization-thread/...

You can achieve the very same thing with a $500 share loan with Alliant CU.  That will get you the installment TL and it will be an extremely small payment. 

[Anonymous]

I do have a student loan in my installments that I will be paying on for the next few years, do you think that alone will be enough to get me by until I get a home mortgage added on in hopefully 6 month?
I have 3 $500 dollar secured CCs on my revolving side.

Thanks!

[Creditaddict]

I would not carry debt that you don't need to try to increase your credit score.... the history of the auto loan will continue for 10 years so it will help after it is closed.

I would look at upgrading your secured cards to unsecured cards now that you have history.

Check pre-qualified for capital one, chase, amex.

[StartingOver10]

Agree with creditaddict above - pay off the difference between what is offered on your Dodge (if you can't get them to pay it) and then get some unsecured revovling cc's. That is what will help your score, much more than an installment TL.

[Klesko]

You will have to pay the balance in full for the buy back to complete. Your lender will require it so they can send dodge the title. 

[Anonymous]

Wait the vehicle have a safety issue and they buying back ur car for 12500 when u owe 15000 on it?? Can't u talk to them and have them buy it back for what u owe?? It's not ur fault that they got safety issue with it

[Anonymous]

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@Klesko wrote:

You will have to pay the balance in full for the buy back to complete. Your lender will require it so they can send dodge the title. 

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+1. To complete the buyback, you'll have the pay the vehicle in full, which means the additonal $2,500. I'll assume this is due to the lemon law. Did they offer a vehicle swap? 

[fury1995]

A Manufacture Buyback is an offer of compomise by the Manufacture.

Lemon Law is legally initiated by the consumer.

There is actually a third scenario called Manufacture Trade Assist, which is different from the above two.

In any of the situations, the collateral title changes hands and the lien must be satisfied unless the lienor explicitly states otherwise.

For Maufacture Buyback, the Manufacture offers a negotiated amount to purchase the collateral from the consumer. Usually, this amount is based on replacement market values. The loan balance has no bearing on the market values, for example if in this situation the consumer owed less than the collaterals' market value.. the Buyback wouldn't be less.

OP: Is this related to the NHTSA investigation and consent order over the FCA safety recalls from April?

[jim44]

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@fury1995 wrote:

A Manufacture Buyback is an offer of compomise by the Manufacture.

Lemon Law is legally initiated by the consumer.

There is actually a third scenario called Manufacture Trade Assist, which is different from the above two.

In any of the situations, the collateral title changes hands and the lien must be satisfied unless the lienor explicitly states otherwise.

For Maufacture Buyback, the Manufacture offers a negotiated amount to purchase the collateral from the consumer. Usually, this amount is based on replacement market values. The loan balance has no bearing on the market values, for example if in this situation the consumer owed less than the collaterals' market value.. the Buyback wouldn't be less.

OP: Is this related to the NHTSA investigation and consent order over the FCA safety recalls from April?

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If it is and from what I've read, FCA will pay the current owner the original purchase price less depreciation.  I believe they will add an additional 10%. I've also read the owner can not have had any of the 3 recalls in question performed.