Voluntary Repossession

[Anonymous]

This is a rather long post, but want to make sure I include all important information. I am a 30 year old male with a 2012 Kia Forte EX financed through Capital One. The original amount of my loan was $17,886.60 with a 74 month term on it. The open date was March 2012 and the current APR is 12.510%. The current pay off amount is $13,373.00. The total principal paid so far is $4582 and the interest paid is $5937. My monthly payment is $316. The maturity date is August 2019. Why so late you might ask? I had a loan modification done sometime ago which extended the loan out for 18 additional months, and I also fell behind a few times and had additional payments pushed to the end of the loan. The car currently has 48,000 miles and the car was rear ended very badly about 2 years ago which was around $8000 in damage at the time and was in the shop for 2 or 3 weeks.

I went through bankrupcy early 2011 and bought this car in early 2012, towards the end of my marriage. I didn't have a clear head when I bought my car and was just out of bankrupcy which was a very poor decision on my part. I had some credit cards between 2012-2014 but I had to let them go during my divorce due to child support and the expense of living along. I'm currently in the process of paying them off. However, regardless, due to my bankrupcy, divorce, etc, my credit is hosed at the moment which is why I am not overly concerned about a repossession. I do not intend to finance a house or anything else for at least 10 years, so taking a hit on my credit is not a concern for me.

The KBB value on my car as a "trade in value at a dealership" is roughly $8000, so I figure it will probably go for $6000 or so at an auction, which would leave me roughly $7000 or so to pay back. The way I see it is $7000 is a lot less to pay than 12.5% interest over the next 5 years on $13,300. My thought is to save roughly $2000 or so and buy a decent used car, something just to get me back and forth to/from work, and pay off this remaining loan after the repossession.

Yes. I know repossession is bad, it hurts my credit for 7-10 years, I have to pay back the difference, etc etc etc. I understand all that. However, I have $0 savings, so I can't simply just pull some money out of savings and pay it down then sell it... it isn't an option. My parents are divorced and I do not have a relationship with my dad, and my mom doesn't work and I currently help support her. My ex-wife also does not work. I do not have anyone I can seek any help from. Also, frankly, I don't like the car, never have liked it... it's too small, feels cheap, has a "cosmetic" issue that drives me nuts, and has too many memories from my marriage.

Your thoughts? Thanks in advance.

[sccredit]

 If you let the car go you will need a car right?  But you don't have nay savings so it's not like you can go out and buy one.  The way I see it you need transportation and it is a relatively low payment.   I know it is not what you want to hear but I think you need to suck it up and make the payment.

[Ragelog]

Sorry to hear about your struggles. I have been through most of the things you mentioned just never a bankruptcy. 7 years is a long time. I would advise to keep the car 316 isn't a horrible payment. I guess the major question is are you going to need a car or is a car purely a luxury item? If it isn't needed I guess you can turn it in but Voluntary makes no difference except maybe you feel less bad about it since you didn't try to hide/keep the vehicle any longer then you made payments. 

Is it possible to get a second job and put all that income towards the vehicle on top of your normal payment?

Heck even if you deliver pizza and put whatever you earned per month towards the car it would change things relatvely quickly. 

I had to make the decision to voluntarily turn in a vehicle before it was hard but I was unemployed and chose to pay my child support over my car loan. I think it was the right choice but for some reasons it wasn't I still have the charge off reporting on my credit reports.

Good luck to you.

Sam

[Creditaddict]

I actually don't hate your plan but can you save the money and find a decent car to last and get you around for the $2k or so?

the up side to the repo is it will take several months for them to even send you a balance letter and then at that point you can work out some payment arrangements with them or not... it would be 6+ I bet way longer before they would even consider garnish if you made no arrangements with them and that's IF they decided to spend the money for that route

[Anonymous]

While I am not a credit expert I am a car expert and I can say without a doubt there are no longer any decent used cars for 2 grand in America.  Those days are long since gone.  It will take 4-6 k to get something that is realiable and safe.  I certainly understand your frustration but from my perspective it seems paying 7 or more than likely 9 grand for a car you don't have while having to then pay for a cheap used car is not a win.  Your current car will not sell well at auction because the dealers will know that damage history.  Tough situation but I think your plan will make it worse.

Best of luck, let us know what you decide.

[Anonymous]

Sorry to hear about these life changing events. I too went through similar things but my car was repo'ed by the bank. Since I worked from home, I saved 2 grand and bought a 2002 galant for $1400 in 2012. The car is still running today.. with little to no problems. So if you can, save for a little while and buy a little beater on Craigslist until you can afford another car. I literally had my galant for 3 years before I bought another car this past Sunday. I still have my galant and will continue to drive it.

Best of luck to you! 

[Ragelog]

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@Anonymous wrote:

While I am not a credit expert I am a car expert and I can say without a doubt there are no longer any decent used cars for 2 grand in America.  Those days are long since gone.  It will take 4-6 k to get something that is realiable and safe.  I certainly understand your frustration but from my perspective it seems paying 7 or more than likely 9 grand for a car you don't have while having to then pay for a cheap used car is not a win.  Your current car will not sell well at auction because the dealers will know that damage history.  Tough situation but I think your plan will make it worse.

Best of luck, let us know what you decide.

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I think if you look hard enough you can find something. Will it be perfect no but will it run and be safe yes. I purchased a 1998 Windstar for 1500 about 5 years ago it ran fine until it was wrecked nearly 3 years ago. I replaced it with a $2300 2002 Jeep Grand Cherokee in 2012 and that vehicle always started and got me from A to B with Heat or AC until I sold it just over a year later for 2k. 

I would personally look at vehicles that have a drivetrain with a good history and find that diamond in the rough. The only reason I got rid of the Jeep is I was going to move for a job in TX and didn't feel it could commute 10 hours back and forth often to visit the kids. I ended up never moving :/ otherwise I would likely still be driving the Jeep today.

Is it easy to find no and you need to move fast but it is possible.