If vehicles are not reaffirmed - how to buy a different vehicle? and ?'s about Ally

[basketsbears]

Hi,

We haven't filed yet. Idk if we will reaffirm our vehicles or not. If we don't, and just continue to pay and drive, what happens if we want a different (less expensive vehicles)?

Can we just go into a dealer and trade, and they aren't able to to roll balance into new loan? If we tried to sell them privately, then what happens? Is it best to just turn them in when wanting to get a different vehicle? If the debt isn't reaffirmed, our credit doesn't take an extra "hit" if we turn them in after - right? Both of our vehicles are with Ally, which was GMAC. So if we return our vehicles I am assuming that Ally would not want to finance us again (I'm asking because it seems like they have given people pretty decent rates in reading some of the posts here).

I'm probably asking these questions too soon. After reading some of the topics here, these questions came to mind.

[mountanddo]

So are you planning on taking the new vehicle that you just bought in December, have it discharged in chapter 7, sell it privately and then buy something cheaper? If you turn them in to trade the new one isn't worth anything since you haven't paid anything really on it. I would assume they would just take it back. You might be able to trade in the vehicle that has 42 months left on it but I would guess that since the loan isn't paid off they are going to take that off the trade in and that might make your trade in worth nothing. I guess you could have them take the cars and take the money you would of spent on the two loans and get something cheaper.

[IBroke]

Hi,
Can we just go into a dealer and trade, and they aren't able to to roll balance into new loan? If we tried to sell them privately, then what happens? Is it best to just turn them in when wanting to get a different vehicle? If the debt isn't reaffirmed, our credit doesn't take an extra "hit" if we turn them in after - right?

Your credit won't get an extra hit. That's correct. If the vehicles aren't reaffirmed and you want to get rid of them, you simply contact your lender (Ally) and tell them that you don't want them anymore and that they can have them back. They are going to tell you what happens next. Selling them privately makes no sense, either - unless you have equity in them which doesn't seem to be the case. Since you didn't reaffirm, there is no "balance to roll" into a new loan. You will be getting a fresh start.

I don't know Ally's policies but if your payment-history on auto-loans is good and you want to DOWNGRADE after your discharge, you should be able to get a new loan. If not from Ally, then maybe from Cap One or others.

[basketsbears]

So are you planning on taking the new vehicle that you just bought in December, have it discharged in chapter 7, sell it privately and then buy something cheaper? If you turn them in to trade the new one isn't worth anything since you haven't paid anything really on it. I would assume they would just take it back. You might be able to trade in the vehicle that has 42 months left on it but I would guess that since the loan isn't paid off they are going to take that off the trade in and that might make your trade in worth nothing. I guess you could have them take the cars and take the money you would of spent on the two loans and get something cheaper.

I am just looking at different things. Ideally, if we surrender the new truck (I am feeling more stupid about that everyday) we would just use cash and buy a beater for awhile. I am not really looking into financing, but didn't really know other than turning car back in what if someone wanted to purchase how did that work. We have also thought of not reaffirming both vehicles, and getting beaters and not having any car payments at all. All this is new - just wondered how it went.

[basketsbears]

Your credit won't get an extra hit. That's correct. If the vehicles aren't reaffirmed and you want to get rid of them, you simply contact your lender (Ally) and tell them that you don't want them anymore and that they can have them back. They are going to tell you what happens next. Selling them privately makes no sense, either - unless you have equity in them which doesn't seem to be the case. Since you didn't reaffirm, there is no "balance to roll" into a new loan. You will be getting a fresh start.


I don't know Ally's policies but if your payment-history on auto-loans is good and you want to DOWNGRADE after your discharge, you should be able to get a new loan. If not from Ally, then maybe from Cap One or others.

Thanks for the information. We have not missed any vehicle payments - so that should be good. If we do surrender them like I said to MD, I would be apt to just get whatever we purchase with cash, then save like crazy, and perhaps in a few months or a year, then purchase one nicer vehicle with the cash, or if needed to finance, would have a nice down payment and have hopefully a decent rate and not a long term (48 months or less).

I had been following Dave Ramsey on and off and even when we purchased the truck, all I kept thinking is how screwed up this whole thing is. So, I am thinking if we are going to do this (which we are) we need to make smarter decisions (at least me the last month or so) to have this truly be a fresh start. Dave very much talks about people getting rid of cars they are upside down on.

[IBroke]

I had been following Dave Ramsey on and off and even when we purchased the truck, all I kept thinking is how screwed up this whole thing is. So, I am thinking if we are going to do this (which we are) we need to make smarter decisions (at least me the last month or so) to have this truly be a fresh start. Dave very much talks about people getting rid of cars they are upside down on.

In your case, you can totally ignore the fact that you are upside down since you don't reaffirm. The only question should be: Are you paying too much every month for your current ride? If so, that would be the reason to get rid of it. Your savings/purchasing plan sounds fine to me.

[basketsbears]

In your case, you can totally ignore the fact that you are upside down since you don't reaffirm. The only question should be: Are you paying too much every month for your current ride? If so, that would be the reason to get rid of it. Your savings/purchasing plan sounds fine to me.

Thanks again. We are awaiting the plan from attorney, after reading some of the posts here I was curious how it worked if we didnt reaffirm and just made payments, then wanted a different vehicle before loan was paid off.