The Jag I bought my wife a year or so ago is being driven by me..my wife doesnt like it and prefers driving the GC over the Jag. She wanted it at first, but somewhere along the line decided it wasnt for her..I personally dont like it either..its a car, but not really my style..Anyway Dianne tells me to get rid of it..I talk to a dealer and he offers me lik 6k for it..I owe about 11k on it..I am pretty mucch stuck with the damn thing..I got a letter yesterday saying the intend to repo it unless I pay them like 900 bucks that I am behind on payments..My credit score is in the toilet at the moment, so I dont really care about what happens to it..We can get by with 1 vehicle for awhile and buy something that I wont have a payment for in a couple months. I could sure use the 300 a month that I pay for a car we both dislike for something else. My question is, should I just let them take it? We got behind on pyments around the time of my surgery and never got back on track..We struggle every month to just barely get by and not having this payment would be a big help right now. Dianne plays roulette every month deciding what besided the mortgage gets paid. I am also considering reducing my class load at school so I can work more ot and get things caught up..I just dont know what to do about the car...
So I have this car...
- Thread starter Riff62
- Start date
SPACEMONKEY1
Full Access Member
First thing you need to do is ask a lawyer or someone that would know how much a repo would affect your credit. Next if you find out that it's not gonna hurt it too much then let them take it if your credit is already shot. Last thing you need to do is get a secured credit card. Make sure you take your time in choosing one. The one we offer at my bank is at an 18% interest rate, which is nuts. The secured credit card will help your credit score big time!!! The extra $300.00 you'll have from not paying on the card can be put towards the secured card and you'll start raising your score.
I called GMAC who has the loan for the car and they really dont want to help out. They said if I had paid 50% of the loan, they would refinance what is owed..I am only 1.5 yrs into a 5 yr loan so no help there..They dont want the car any more than I do..lol..
My credit score is in the lower 500 range due to my debt to income ratio..I used to make 70k a year and with the new job I am at 50k..I got rid of my truck and a lease I had that was ending, and bought the Jag and the GC at the same time, which lowered my payments from about 1k a month to about 650. At the time I thought it was a good plan, but I didnt go far enough in trying to cut out car payments..
As for credit cards, I have 2 which I dont use any more really..I am paying down the balances, and when they are done, I will only keep one for emergencies, such as I have no cash and m bar tab needs to be paid..lol..
I know there are a ton of things I can do to cut the un needed spending we do..I am looking at options, and am heavily invested in PowerBall tickets..so I know one day this will all be something to laugh about..
Anyway, I will talk to some people about the repo, and the effect on my credit score. I am also looking at refinancing my house, as I have an FHA loanwhich can be refinanced with no problems,,If I decide to let them repo the Jag, I will not be able to refi the house because you need a score of 525 at the minimum...I think I have a 7 1/8% rate on the house right now and can get it to 5.5 or so if I refi..I guess I need to think about this for a day or so. Any input is appreciated..Thanks,
Riff
My credit score is in the lower 500 range due to my debt to income ratio..I used to make 70k a year and with the new job I am at 50k..I got rid of my truck and a lease I had that was ending, and bought the Jag and the GC at the same time, which lowered my payments from about 1k a month to about 650. At the time I thought it was a good plan, but I didnt go far enough in trying to cut out car payments..
As for credit cards, I have 2 which I dont use any more really..I am paying down the balances, and when they are done, I will only keep one for emergencies, such as I have no cash and m bar tab needs to be paid..lol..
I know there are a ton of things I can do to cut the un needed spending we do..I am looking at options, and am heavily invested in PowerBall tickets..so I know one day this will all be something to laugh about..
Anyway, I will talk to some people about the repo, and the effect on my credit score. I am also looking at refinancing my house, as I have an FHA loanwhich can be refinanced with no problems,,If I decide to let them repo the Jag, I will not be able to refi the house because you need a score of 525 at the minimum...I think I have a 7 1/8% rate on the house right now and can get it to 5.5 or so if I refi..I guess I need to think about this for a day or so. Any input is appreciated..Thanks,
Riff
TREKER
Full Access Member
If credit is in dump and you are that behind, bankruptcy may be best choice Matt. You can keep cars and house. As long as you continue to pay for things, banks dont want them back.
yeah..I am looking into things..The house isnt an issue. Thats the first thing we take care of..The cars well, are somewhat of an albatross for us..I need to just get rid of both of them and start over again..I just made some stupid choices I guess..I never was good with money, and am learning as I go..
Texas Yellow Fever
Full Access Member
Is there someone (family or good friend) that you would trust enough to take the car for what you owe on it and make the payments on it going forward? That might be a better option than letting be repo'd, if you could trust the person enough not to screw you.
ChrisAZ
Full Access Member
First, if you let them repo the car it will be auctioned off and YOU will still owe the balance of what they don't get for it. I suspect that will be $5k plus. They can sue you and get a judgement for that amount and the judgement will be on your credit. They can garnish your wages to collect on the judgement. So you aren't going to help yourself by letting the car go back.
Second, if you can refi your house, can you pull some cash out of it? If so, it would be wise to pull ONLY ENOUGH to pay off the car so you can sell it. Don't pull a bunch of cash out of your house and blow it.
Seriously, the best thing you could do is refi the house and pull out enough to pay off all your credit cards and car loans. The house is a tax write off and the lowest interest you can get. This is a home run plan if you can do it. The key is then to avoid ANY new debt. Don't use the credit card and don't finance another car. Live cheap and save cash. Pay an extra house payment per year and apply it to principal only and your house will be paid off in 17 years instead of 30. Then in 17 years, you will own your home and have NO debt...NONE! How would that feel?
Second, if you can refi your house, can you pull some cash out of it? If so, it would be wise to pull ONLY ENOUGH to pay off the car so you can sell it. Don't pull a bunch of cash out of your house and blow it.
Seriously, the best thing you could do is refi the house and pull out enough to pay off all your credit cards and car loans. The house is a tax write off and the lowest interest you can get. This is a home run plan if you can do it. The key is then to avoid ANY new debt. Don't use the credit card and don't finance another car. Live cheap and save cash. Pay an extra house payment per year and apply it to principal only and your house will be paid off in 17 years instead of 30. Then in 17 years, you will own your home and have NO debt...NONE! How would that feel?
kickinassrt-10
Full Access Member
Hey bud no surprise that the bank won't work with you....they are some extremely greedy bastards....my brother had an 06 ram he got for 24K out the door brand new loaded b/c we knew the people, it was $650 a month, already has paid $18K toward the truck and it's worth only $15K the bank didn't want to do a damn thing and he could use the extra couple hundred every month....they didn't want to work on his loan so they threathened with repo...he told them straight up come get this over priced piece of shit, they said bla bla bla it's going to auction and you will be responsible for the remainder....well that'll be a cold day in hell before he just flat out pays for the remainder and will settle one day for pennies on the dollar...
he went out and got a G35 he pays $290/mo for
I would do the same in your boat, tell them to pick it up and don't look back....that is unless you can sell it for damn near what you owe then you will only be out a few $1000
also credit is a bunch of shit these days
Also one last thing with all the repo's out there right now it will be literally at least a year before you go to litigation although you will have 100's of annoying ass calls (speaking from experience) I'm going on 3 years now of collection on some old 4 wheelers i bought and still haven't reached an agreement and told them I won't either until they come back down to reality!
he went out and got a G35 he pays $290/mo for
I would do the same in your boat, tell them to pick it up and don't look back....that is unless you can sell it for damn near what you owe then you will only be out a few $1000
also credit is a bunch of shit these days
Also one last thing with all the repo's out there right now it will be literally at least a year before you go to litigation although you will have 100's of annoying ass calls (speaking from experience) I'm going on 3 years now of collection on some old 4 wheelers i bought and still haven't reached an agreement and told them I won't either until they come back down to reality!
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I was thinking something along the lines of what kickinass wrote..Yeah I will have to pay the remainder, but can settle with them later..Its because of the cars that my debt ratio is so high, and that is mainly what is killing my score..well that and a couple medical bills...I cant sell the car for what I owe..it isnt worth half of that..lol..I cant trade it in, they wont give me anything for it, and if I roll the difference into a new loan, assuming they will do that, I will still be stuck with a high payment.
As far as taking cash out when doing the house refi, I dont think I can.I have only had the house for 4 yrs, and refinanced out of an adjustable mortgage to the FHA one 2 yrs ago, so there isnt much equity there..Maybe the car will mysteriously spontaneously combust sometime..lol..Im JUST KIDDING GMAC...lol
About the only way I can see out of this is to either keep paying it off or tlet them take it..
As far as taking cash out when doing the house refi, I dont think I can.I have only had the house for 4 yrs, and refinanced out of an adjustable mortgage to the FHA one 2 yrs ago, so there isnt much equity there..Maybe the car will mysteriously spontaneously combust sometime..lol..Im JUST KIDDING GMAC...lol
About the only way I can see out of this is to either keep paying it off or tlet them take it..
ChrisAZ
Full Access Member
Remember, they can get a judgement and garnish your wages. The garnished wages could easily be more per month than your car payment.
I am in the same boat as you. I have checked into a refi with my house too. I have had my house for a little over 2 years. My current interest rate is 6.25% The going rates are around 5.5%, after closing cost I would only be saving about $50 a month and if I put the house up on the market I would have less equity than what I have now. The thing with these loans is USUALLY there is no credit check or verification of wages as long as you refi the current loan balance per Obama. I believe it was called "Streamlined FHA loan". Refi isn't a real good choice for me.
With your current interest rate it might be worth a refi for the amount you could save. I don't know how to crunch those numbers. But I would have to guess you might save around $200 per month on your house payment. .75% interest rate reduction would save me about $50 like I said. You would be cutting your rate by 1.75%.
I am trying to sell my truck and very upside down on it. More than likely it will go back to the bank. I have the money to make up the difference, but like you my first priority is the house. The money I spend on getting the truck settled could affect how long I can keep the house. I don't see any realistic options for me on this. I have accepted my credit score will be shot.
Auto loans are different. Like it was said before they can come after you for the difference. I doubt the bank will go for it but it is worth a shot. Let them take the Jag back and wait to see what you will owe after the auction. On the remaining balance see if you can get a personal loan on that amount. Interest rates will be much higher. It is still better than having your wages garnished though. For me I could probably pay off the difference on my truck loan. But with the other bills I have I am still dipping into my savings. For me I would rather have the money for an even rainier day.
In 96 I had some debt(credit cards) I could no longer pay for. I stopped paying on them and as expected I got numerous phone calls on them. I even threatened them with bankrupcy. I said do you want some money or no money. They could have cared less. I could not even afford to get a bankrupcy lawyer. As expected my credit was shot. What I didn't know at the time was the bad remarks on my credit score would come off after seven years. Pretty much the same as a bankrupcy. That also convinced me to not file for bankrupcy too. And they never garnished my wages.
I am watching this thread for some ideas too. You and I are in the very same boat and the bilge pump isn't keeping up
With your current interest rate it might be worth a refi for the amount you could save. I don't know how to crunch those numbers. But I would have to guess you might save around $200 per month on your house payment. .75% interest rate reduction would save me about $50 like I said. You would be cutting your rate by 1.75%.
I am trying to sell my truck and very upside down on it. More than likely it will go back to the bank. I have the money to make up the difference, but like you my first priority is the house. The money I spend on getting the truck settled could affect how long I can keep the house. I don't see any realistic options for me on this. I have accepted my credit score will be shot.
Auto loans are different. Like it was said before they can come after you for the difference. I doubt the bank will go for it but it is worth a shot. Let them take the Jag back and wait to see what you will owe after the auction. On the remaining balance see if you can get a personal loan on that amount. Interest rates will be much higher. It is still better than having your wages garnished though. For me I could probably pay off the difference on my truck loan. But with the other bills I have I am still dipping into my savings. For me I would rather have the money for an even rainier day.
In 96 I had some debt(credit cards) I could no longer pay for. I stopped paying on them and as expected I got numerous phone calls on them. I even threatened them with bankrupcy. I said do you want some money or no money. They could have cared less. I could not even afford to get a bankrupcy lawyer. As expected my credit was shot. What I didn't know at the time was the bad remarks on my credit score would come off after seven years. Pretty much the same as a bankrupcy. That also convinced me to not file for bankrupcy too. And they never garnished my wages.
I am watching this thread for some ideas too. You and I are in the very same boat and the bilge pump isn't keeping up
505'sFastestViper.
Full Access Member
that my friend is why i dont finance anything anymore....if i can not pay for it out right i do not need it.....dave ramsey is a multi millioaire and he has a 0 credit score
Stanimal
Full Access Member
i can say this for fact. they can only garnish yourt wages 10%. i dont know how much 10% of what you make is but thats the max and only one collector can garnish at a time.
Some very helpful info on here..keep it coming guys..And Dom, I agree with you bro, but it doesnt help the current situation..If I had thought about it more before I bought the Jag, I would have just gotten a peice o crap to drive for awhile..could woulda shoulda..Going forward I can make changes, but have to deal with the situation as it is presently..But thanks for the advice..I will definetely think twice..next time..
WearyMicrobe
Full Access Member
505'sFastestViper. said:
This only works if you have a "large" amount of cash, from say a show and some books on how "great" and "smart" you are. Or live in a low tax state, with minimal housing cost.
Credit when used appropriately is not a bad thing.
505'sFastestViper.
Full Access Member
he started with nothing, and then made a lot of choices good ones and some bad and then got paid dave ramsey is new money it was not handed to himWearyMicrobe said:
Borden's SRT
Full Access Member
I dont know if anyone else mentioned this but sometimes with a repo they still charge you anything they cant get out of your car at the auction. so if you owe $11k and they sell it for $5k, they still expect you to pay the difference. Hope that helps you a little to make your decision. I'm sure its a tough one tho. Best wishes!
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