Legal Question in Credit and Debt Law in California
Voluntary car repossession
Upon the cooperative return, of a car, to the lending co.; what financial reprissal would I be submitting too? Must I pay the difference between lenders compensation from an auction sale and the remaining balance or is satisfaction achieve with collateral return?
1. Vehicle is valued at $6,000 and the outstanding loan balance is 14,000.
2. The monthly payment is very taxing to my budget, minimum wage, 2 children.
3. Would like to avoid bankrupcy over one issue.
3 Answers from Attorneys
Re: Voluntary car repossession
yes you have to pay. If you dont, who will?
Re: Voluntary car repossession
Have you sent it back yet? If not, sell it ... don't depend on an auction.
You say it is worth $16K, and you owe $14K, sell it for $14K! It should sell fast. Just make wure that you get a cashiers check payable to the lender, and take it there with the buyer.
Re: Voluntary car repossession
Yes, in general you are liable for the difference between the auction value and the loan balance. Keep in mind that the auction proceeds are going to be a lot lower than you could sell the car for yourself. I think it is good advice to try to sell the car, with consent of the lender, and then work out payment arrangements for the difference with the lender.
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