Find Seized Car Auctions Near You

Know Where To Buy Your Dream Car For A Low Price!

Whether It Is A Mercedes, BMW, Honda, SUVs, Trucks...

Drive Your Dream Car For 90% Below Retail Prices!

Start Looking For Your Dream Car Now!

My cousin (whom I love to pieces) is going through some really tough financial times, With the recession, I’m sure we all know someone who might be struggling with bills.
She recently told me that she is considering letting her finance company (Toyota) repossess her vehicle (2006) so she wouldnt have to worry about the payments. She asked me how horrible her credit may look after that, and I told her that since I have only had my car for about a year, I wasn’t too sure.
In case she does allow Toyota to repo, how badly would it affect her credit score and would there be a way for her to re-build afterwards?
My heart really goes out to her as it does for anyone who is going through situations such as this. I hope someone out there can give me some feedback to pass along.
Thank you in advance.

4 Comments »

1. 

   Is there anyone in the family/friends circle who could pay this loan off and then have her make lower payments to them? If so, they should be shown as the lien holder on the title until she pays them back in full.

   A repo is going to be a real big hit to her credit and take 7 years to work off, plus they can come back on her for the shortage. A wage garnishment would not help her.

   Comment by Sharon T — December 31, 2010 @ 11:27 am

2. 

   Been in that situation. Not a pleasant place to be in and I feel for your cousin. She is not alone with being faced with that decision. I would follow others advice of seeing if someone could help her with her payments. It is not a pleasant experience having a repo guy show up at your home. No all of them are nice and they can be very aggressive. If she decides to turn the vehicle in, then I would make arrangements to drop if off instead of having some nasty, verbally abusive thug come to her home. Good luck to your cousin.

   Comment by MKD — December 31, 2010 @ 11:27 am

3. 

   Anytime you fail to live up to a financial obligation that you agree to, it will severely hurt your credit. You cannot stiff lenders and not think that there are serious long term consequences for that. That is the WHOLE point of having a credit report system.

   Comment by Ryan M — December 31, 2010 @ 11:27 am

4. 

   Moni,

   My heart goes out to your cousin as well, these financial times are getting harder and harder on even the working class. My boyfriend just recently "voluntarily" repossessed his car by calling his finance company and telling them that he could no longer afford the payments. Please note that the reflection on your credit report doesn’t differentiate between repossessed or "voluntarily" repossessed, its all repossessed. Anyway, He financed the car for $15,000 and still owes $9000 on the care, the company will call a tower to come and get the car and then sell it at auction. Let’s say the car only sells for $5000, he will still be responsible for $4000. The finance company will then enter a judgment against him for the $4000. So not only will he have a repossession on his credit, he will also have a $4000 judgment against him until he can pay it off. Just because he pays it off though doesn’t mean that the judgment will come off of his credit report, it is required to stay on there for 7 years as will the repossession.
   So with this information, if your cousin has anyone else who can take over her payments, it would be more beneficial in the end as opposed to suffering through 7 years of these types of entries on her credit should her situation improve. Coincidentally right after he gave the car back, he got a new job, go figure!
   Good Luck to her in her situation!!! Your swell for trying to help her.

   Comment by Leah B — December 31, 2010 @ 11:27 am

RSS feed for comments on this post. TrackBack URL

Leave a comment

Name (required)

Mail (will not be published) (required)

Website