I did repossessions for Ford Motor Credit (and some other lenders) for several
years and a repossession (even voluntary) is still a repossession. When you
signed the contract, you agreed to make the payments on your brother’s loan (if
he couldn’t or defaulted), for the life of the loan. If you do not see the
loan through to completion, you too are in default of your contractual
agreement with Ford Motor Credit. Remember, in the end, Ford doesn’t want the
truck; they want their money. A voluntary repossession, while always an
option, should be your LAST option. Odds are, with more that 3 years left on a
60-month loan, you owe more than the book value of the truck. The first year’s
deprecation is a real kick in the nuts. First and foremost, stay in contact
with the creditor. Call them and talk to them. As long as you’re in good
standing on the loan, they should work with you to ensure that in the end, they
get their money. Explain the situation and tell them you wish to sell the
vehicle, asking what your options are. If I recall correctly, it’s been a few
years since I was in the business, they may have some options that will allow
you to sell the vehicle to a third party.
BTW. Good move on convincing your brother to give up the truck. Stepping in
like you did is what you agreed to by co-signing the loan. Many co-signers
don’t and are often surprised by how much it affects their credit when the
principle buyer defaults. By helping your brother keep the loan current, you
saved yourself and your brother, future credit hassles.
Walt
http://www.Walt-n-Ingrid.Com
In article <cephoo$5p8$1@bent.twistedbits.net>, andy-dml@levyclan.us (andy
levy) writes:
>
>
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> On 8/3/2004 10:19 PM, Valentin Garcia wrote:
>
> | Problem:
> | Should I call Ford and tell them to come pick it up (voluntery
> | repossesion) and have my credit jacked for the next 7 years, or try and
> | trade it in and have 3 car payments? Financially my wife and I will be
> | okay, providing we don't lose our jobs, have a kid, get divorced, etc.
> | My Dak has 2 years and 2 months left on her, Her Neon is being used as
> | collateral for the next 3 years, less if we up our payments. The Edge
> | has 3 years and 4 months left on it. I don't want to keep the Ford, but
> | I am unsure on whether to trade it in or Kill my credit for 7 years.
> | Help me!!!!!
>
> I don't see how there's a choice. Do anything and everything to avoid
> hitting your credit rating. If it's a loan for buying the truck (not a
> lease), and the truck is in decent shape, then you should take a minimal
> loss on selling the truck. Heck, if you find the loss acceptable, price
> it to sell (well under "market" value) to make sure you get rid of it.
> They key points are (as I see it) to A) not hurt your own credit
> situation and B) unload the responsibility that comes with the truck
> (payments). Selling the truck outright should accomplish that.
>
> IMHO, if anything comes to a choice of "do X or kill my credit rating"
> I'll take "X". Your credit rating will affect your credit card interest
> rates, chances at a home loan, new car loan, cost you a new job (many
> employers seem to be checking credit ratings now) and who knows what else.
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