Surrender Car right now? or later?

[shelveen]

Hello Everyone

This BK Forum is great. Here is my spill...im 21 years old with about 40k in debt. I want to file chapter 7 bk. I have talked to a few lawyers and stuff, but they give all the legal stuff, i want a real persons opinion.

here is my main question

i have a lexus which i bought for 45k...about a year ago...i still owe about 38k on it and paying 14% interest. im way upside down. i jsut want to get rid of it. im two months behind

i want a fresh financial start with everything.

please help

oh yeah, my parents will buy me another car if i surrender this one, and they will get me a credit card or cosign for me to build my credit up again.

what should i do? do i surrender right now?

[ansky0007]

A surrender looks better than a repo, If you definately dont want it anymore get rid of it.

[Mi Bankruptcy]

Do you have 40K in CC debt and 38K in Vehicle debt?

[Hopefull1983]

I'm in a very similar scenario as you. I did not want my vehicle because it was outrageous and I was way upside down. The smart decision is to get rid of it so that you can get a fresh-start. I surrendered my vehicle to citifincial after I was two months behind. They really didn't want me to and had many tempting offers for me, but the smart choice was to get rid of it. If you can survive without the car then do it.

[shelveen]

Do you have 40K in CC debt and 38K in Vehicle debt?

yes i have both

so yes im about 80 in debt

how do i go about starting the surrender?

[yorkin]

I was in the same situation with my car...I just stopped paying on it and then fielded the phone calls the best I could...I didn't tell them I was going to surrender it, I let it go as long as I could. I would schedule payments over the phone at first to give me some more time and then when the payments didn't go through, I would field the phone calls again. In June, after not paying for about 5 months, we told them we were surrendering the vehicle but that my sister had taken it to Georgia and wouldn't be back until August. We even set up a pick up date. I kept it in the garage any time it was at home and was prepared for it to "disappear" when I went somewhere but it never did. I found out they use GOOGLE EARTH to see the car at your house. They really don't want your car so they aren't crazy aggressive. If you file before they take it, they can't take it after you file unless they appeal to the court. If they appeal to the court, the court always grants them the right to get their car. If it's an expensive car, like mine was and yours is...they aren't going to let you keep it anyway, because if you can pay for that, you can pay your bills. Be prepared to deal with the phone calls and don't tell them you're filing or they'll RUN to pick up your car. I didn't have the ability to get a new car so that was my motivation to hang on to it as long as possible which was about 8 months without having to pay for it. If you are able to get one, then maybe you don't want to deal with the stress and headache. Since they took it, they sold it and now the difference ($28,000) is one of my debts to add to my BK. Make sure your parents keep your new car in their name and good luck. I've been accruing my debt since I was 21 and now I'm 43!! If I knew then..... Oh well...For you, really get a clean start and be smart in the future and you'll have great credit later when you really need it!!

[Dollar Bill]

Yorkin...very nice.

So your saying that when the car company sold it through dealer auction they took a 28k loss?

[yorkin]

Well, what they did was sell it for $19,900 and I owed $47,900. It had some collision damage to it because I was rear-ended by an uninsured driver and I couldn't afford my deductible so I just left it. So anyway, I am responsible for the difference but it becomes a debt on my BK just like everything else. They don't know yet that I'm filing...I guess they hope I'm going to pay it. Kind of ridiculous because if I could pay the $29,000 I could've made the payments in the first place and wouldn't be filing for BK. I guess it's just protocol. I'm learning SO much in this whole process...and I've learned to stomach so much more than I ever thought I was capable. I think one of the best things I ever heard was "you can't go to jail for not paying your bills" and since nothing terrifies me more than the thought of going to jail, everything else seemed easy! Go figure! What doesn't kill you makes you stronger!!!

[AngelinaCat]

Yes, the $29,000.00 difference will be discharged. We had a $13,000.00 difference for a car loan that we foolishly co-signed in order to help an acquaintance out. When he defaulted on his payments, the finance company came after us. When we filed BK, we included that amount, which is discharged, and the deadbeat acquaintance is stuck with the $13,000.00 judgment.

Moral: don't ever co-sign anything!.

[shelveen]

OMG yorkin, you are teh best

thank you very much...im going to contact them tomm and surrender it and then go to the lawyer and file bankruptcy....any suggesstions on lawyers?

[thelonius]

Citifinancial Auto loan

Here might be some good news for anyone behind on a high car payment that is thinking about surrendering their vehicle.

I was 2 1/2 months behind on a $405/month auto loan with Citifinancial Auto. I am planning on filing BK within the next week or two. My wife and I were worried they may come and repossess our car, so we decided to just surrender it.

I called them and said I would like to surrender it. After going through my income and expenses they offered to drop my interest from 15% to 4% and extend my loan a year to bring the payment down to $208/month.

Try it yourself, it might work.

[Dollar Bill]

That sounds wonderful.

I do know that it really depends on the lender. My auto loan is with Chase Auto Finance. I called them today and asked if there was something I could do in regards to modifying the loan. They said they do not negotiate whatsoever. If I do not want the car then they will file some paperwork at the end of this month in order to pick it up.

[debtmonster]

Those people at Chase sound like real dorks. They are just making the situation worse. They seem to be good at pissing off a lot of people.

This sounds like a good idea to do with my BMW as my payments are $740/mo. If they could drop it down to $350/mo, it would be worth keeping, but I don't see that happening. Apparently the trade-in value is about $25k and I owe $37k. If they auction it off, they will probably get $17-22k for it. It would be easier for them to do that instead of wait for $21k for me for 60 months.

I bet I would get a ton of people ragging on me if I kept this thing as many people have strongly recommended that I give this thing back and to get a cheaper car with no payments.

[Dirk Squarejaw]

I found out they use GOOGLE EARTH to see the car at your house.

I think that may be some sort of repo-man urban legend. Google Earth is not realtime and there would be no reliable way to use it for this purpose. For instance, the two cars that appear in my driveway on Google earth are my 2003 Mustang GT and 1990 Nissan Sentra. The last time those two cars could have been in my driveway together is May 2005.

[debtmonster]

What about cars with OnStar? I would think GM would know to tell the repo man where those cars are at all time.