Bad Car Loan - Anyone else trapped?

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Mar 26, 2009
3 months ago, I financed a car for $20k at 72 months with a monthly payment of 500. When it concludes in 2028, I'll have paid an extra $15k. My credit score is high 600s, The only reason the deal was so bad is cause I had just spent most of my savings paying down my ccs and didn't have a more significant down payment (1400 |l) And because the cards were paid off so recently, my older maxed out balances were showing up when they ran my credit.

Insurance is whats got me in my feelings tho. Compared to my previous car I am paying an extra 100/mo which didn't surprise me as the value is 2x and it has a loan attached to it. What I had forgotten about, last Spring in my old car I had hydro-planed into this lady at a red light partially because of the rain and partially because the brakes on that car needed work. So when I got my 2023 renewal policy it looks like I'm paying ANOTHER 100/mo because I lost my 5 year safe driving discount and because they applied the claim.

Last summer after the rear end incident I let the car sit at home and reduced my coverage to liability for like 2 months until I had enough saved up for repairs.

I was thinking of doing the same thing, but it turns out the loan requires me to carry full coverage otherwise they have the legal jurisdiction to come and repo the car. Besides waiting for the claim to fall off, all of the salt that's going to be on the road the next 3-4 months is something else that bothers me.

I already reached out to the lender about voluntarily surrendering the car, but it's going to ruin my credit for the next 3 years (pretty much the same as a repo) and then they'd auction it off at a real low price and I'd still be on the hook for the next 72 months, at like 200 per month.

Reached out to the dealership about selling it back to them, and they'd give me about $17k...I would have to immediately pay the lending company $3k (which I don't have) meaning I'd have to take out a personal loan.

Seems like I'm stuck in an impossible situation, short of hitting the lottery or getting a raise I'm gonna be paranoid these next 6 months of barely making my bills on time.
 
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brother I got no advice to give, but I really hope **** shakes in your favor. financial woes suck, Ive been there, shidd Im still there lol but whatever extra cash you can make/save please find a a way to take advantage of. Im rooting for ya.
 
First off, don't give it back. It's "pretty much the same as a repo"? It's not "pretty much, it IS the same. Just termed a voluntary repossession. And it's not 3 years, it will be on there for a longer time than that (I've seen it). And it will affect a car purchase using credit for a long long time. As with the balances. If they were paid off before you got this loan, but didn't show on your score, you could have printed the current balances from your cardholder website, showing a 0-balance and the finance office at the dealer could have called in the info. I've seen this as well (because some stuff hasn't hit FICO but it's there to view).

May I ask? Why did you purchase this car when you did? Was a necessity to get one or did you just want a newer car? Because if it wasn't necessary, that's the thing you shouldn't have done. Far too many times I saw people come into my dealership and want a new car, despite their car they currently have was totally fine (I've told them as such when they balked at why the payment was so high). Also, did you happen to trade a prior car in on this new one? And if so, did you owe anything on it?

If you want to try to sell it, don't take what the dealer you bought it from's word on the value. Go and get competing offers from other locations like CarMax, Car shop, Carvana, Vroom, KBB, etc. Some places will pay a lot more for certain cars. You can get legit offers right online by filling out their trade in evaluation software form. If you have any questions, feel free to reply or you can PM me if you don't want it public (sold cars for a LONG time, so I know this stuff). 👍
 
transfer your lease to someone who take over the payments.
https://www.swapalease.com/ is site that was recommend to me, check for others.

good luck though.

This, I'm 99.9% sure, is not a lease. It's a 72 month purchase (leases don't go 72 months unless it's an exotic/high-end lux brand not though the manufacturer). So Swapalease won't work here.
 
He said he financed it. It's not a lease.

There is a way tho... 👀
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Sorry to hear this. Like another poster said, I’d try carmax. I sold a lease to them earlier this year and actually got over msrp for it. Not sure if the used car market is still crazy right now but that could reduce how much you have to pay in total.
 
If you get your credit score up in the next year or 2, you might be able to refinance for a better interest rate?
If you really want out asap, you can always sell the car, pay off the 20k debt in a lump sump, and maybe you make it with a tiny bit of profit. Even if you break even or take a small loss, it’s probably better than paying 16k in interest.
 
Im lucky enough to work in finance. I learned a lot about financing. Word of advice: If you going into buying a car worried about the car note…you already ******* up. Unless its a truck or your forever car, theres really no reason to go over 5 years. If the 60 month note is too high, that really means you can’t afford it.

First and foremost….did you get the gap insurance??? If you did, might want to ended up in Houston next time a hurricane comes through. :lol:

Seriously tho, principal payments are going to be your friend. If your institution doesn’t let you call up and make principal payments, just make the regular payment. Then, same day, make the extra payment. Do that for a couple of years, refi and that will slow the bleeding. Tbh, unless you got a big down payment, don’t even think about trading it in.
 
May I ask? Why did you purchase this car when you did? Was a necessity to get one or did you just want a newer car? Because if it wasn't necessary, that's the thing you shouldn't have done. Far too many times I saw people come into my dealership and want a new car, despite their car they currently have was totally fine (I've told them as such when they balked at why the payment was so high). Also, did you happen to trade a prior car in on this new one? And if so, did you owe anything on it?
The heater on my old car went out, and it would've been 1k to fix. Also I was barely over 100k miles BUT with this particular year and model, it was a 50/50 chance the transmission could blow at any given moment. I had just gotten into a serious relationship with a chick who doesn't drive and that was a motivator for me.

I had initially went to the dealership on my lunch break and as I was clocking out later that day, he called me back to say I got approved, no trade in necessary. So my plan was to keep the old car, fix it up over the next year. It was paid in full so it would've been a good hand me down for my GF, but she has minimal driving experience and the lack of safety features (back up camera) with it being an older car kind of bothered me.

Then I saw some tax issues on the horizon (I started doing seasonal contract work on the side last year and never set aside a portion of it) so I ended up selling it about 3 weeks ago.
 
Don't do the voluntary repo bro, that'll screw you up more moving forward for anything else you'd like to do. Maybe you should make the vehicle work for you. Have you thought about doing uber eats [I personally wouldn't encourage anyone to do uber/lyft ride share], instacart, or sparks delivery? You can work at your convenience and get extra money to help with the car pmt, and increased insurance. If you have a fulltime job this could help supplement that income in the interim. Within a year or two you could be in a better position financially and with your credit to sell it, trade it in, or refinance for a lower rate.
 
It's simple financing man. Gotta pay extra towards the principal, or refinance in a few months when the APRs go back down. What's is your APR? If you financed $20k otd, with those payments and loan term, than your Apr is like 22%. That's the issue.
 
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