Help! My ex let his car get repossessed and my name is on the loan!

[Msmy13]

I am in the middle if finalizing a nasty divorce. My ex declared bankruptcy and I did not to preserve my credit. (Which I have done successfully my FICo score is 784 but I have paid the more than 20K in joint credit cards.) We agreed to keep our own cars (although we were co-signers on each other's loans. My ex let his car get repo-ed and didn't advise me that he was 3 months behind on payments after his BK was discharged. (He is just being a nasty person.) I just found out last week that the car was repossessed. It will cost me 4-5K to catch up the payments and recover the car. $15K is owed on the car. The car is a 2009 Camry LE in fair condition with 93K miles on it. At best I can get $5-8K. To save my credit score I can pay for the car and satisfy the car loan. However the car won't be worth much in 2 years. Another option: I can let the bank auction the car, but they will come after me for the balance. Either way I feel like I am throwing money away. Meanwhile my Ex is driving a brand new car. Any suggestions would be helpful.

[Remember0]

Who's it financed by? Sometimes lenders won't chase for deficiency, but you never know.

If anything, you need to work out that you get the car if you pay it off. It would su*k to pay and then not have the car. Also the damage to your credit is pretty much done at this point, unless you can get them to agree to a PFD. And I doubt your credit score will be impacted much more unless they sue and get a judgment.

If they auction it, it'll go for a bargain basement price and you'll be left with a larger deficiency than paying it off and selling the car yourself (private party or carmax).

It's really your choice. If they do sue, you're probably better off paying it and selling it to recoup at least whatever it's worth now. But if you're willing to risk they won't sue, leaving it might not be that terrible an idea.

Maybe someone else can chime in here, I'm not THAT much of an expert on these issues. I know that you DEFINITELY should NOT just pay it off before coming to a written agreement with ex as even if you do pay it off, he still has legal right to the car. Hope you have a reliable car because it'll be hard to purchase one now with this history...if not, I'd advise you to work ASAP before the repo reports (apply to DCU, etc...). Also if you haven't already close those joint cards or get him off (in writing), and let this be a warning to others thinking aboout cosigning esp. outside of marriage, and even within one.

[Remember0]

Another wrinkle. Because ex declared BK (and assuming he was primary) on the car loan, if the BK gets dismissed, which it probably already was, the car loan probably won't report as a repo on your credit report I think. I'm guessing it may report IIB instead, which I think might be slightly better. Again, any other experts know more about this?

[Msmy13]

My ex declared both cars on the bankruptcy (the car I am driving to which he is a primary and the car he was driving to which I am the primary). His BK has been discharged. His 3 months of delinquent payments don't show on my credit report.

What is PFD and DCU? Thanks for your reply

[Remember0]

PFD = pay for delete, where the lender agrees IN WRITING that they will remove the bad stuff from your credit if you pay it (usually in full)

DCU = a credit union in MA that offers pretty good APR auto loans. I just recommended you get yourself a new car (trade-in, whatever the old) if your current car isn't reliable as getting a new one if a iib/late pays on auto actually show up will be much harder. If you have a reliable car, I wouldn't sweat it.

Now I'm even more confused haha. Makes sense he declared both as he is a cosignor. I would have thought the car that he was primary on would report IIB, but I guess you're continuing to make timely payments on that one?

Now how come the lates don't show (this is the loan on his car, but which you are primary on, yes)? Does the loan itself show? Usually it should report esp. if you're the primary on the loan?

[Msmy13]

It's weird, the loan he has defaulted on has my name as the primary. It is listed on my credit report but none of the late payments show. It's listed but all blank and marked as "discharged in bankruptcy". Basically the loan I will be paying for 2 car loans where I am the primary on one and co-signer on the other.

[coterotie]

The only other option I can come up with which would be marginally palatable would be to offer them a sum of money (say $3,000) to satisfy your obligations under the loan and have them not report any lates or deficiencies.  If you package this with his BK, your divorce decree etc.  it might work.  I would also think that having this come from your attorney might work a little better (although this will likely cost you some attorney fee time).  When we had situations like this come up, we'd take the bird in the hand rather than the litigation/collection thing in the bush.

Short of hiring some muscle to persuade him   that's about all I can come up with.

[Remember0]

Ah okay. The discharged note is why it's not reporting any lates or repos. That's a good thing.

Another question to ponder about: Do you guys think the finance company is going to realizeshe hasn't also declared BK and go after her? Given that you know, they show the loan as discharged in BK on her credit when she's primary and only the secondary declared BK.

Yet another thing to think about before jumping in and highlighting to the finance company that you haven't BK'ed...I'm honestly split 50-50 on this. Part of me says to work out a settlement, the other part says let's see if they bother to come after you, and if they do then attempt to settle. Sure if they come after you you owe more than trying to settle now. But it's also an aged debt (worth less...they'll settle for less) and maybe there's a chance they never notice and the whole thing's been marked discharged in BK?

Is it possible they miss the fact she hasn't BK'ed coterotie? I assume most exes and married people declare at the same time... Also in the industry, how much higher is it to try and settle when they try to sue/collect vs. now?