CAN CAR BE VOLUNTARY REPOSSESSED

[STUCK WITH CAR? IN TX]

Son has become disabled and lost his job. He has a car that is financed by an acceptance company. He can no longer afford the car. He called them to turn the car in and they told him that they do not do repossessions. This doesn't sound right. Can he make them take the car back. He is aware the repossession will be on his credit and they could sue him for the loan balance..but he has not choice. Can someone help me with this? He also told me that the company told him he could sell the car to a dealership and have the dealership call them and they would transfer. Does anyone know anything about something like this?

 

[JETX]

A creditor cannot be forced to accept a collateral in lieu of payment. (Note: your situation sounds unusual. The whole purpose of the collateral is to secure payment. If payment is not made, most creditors grab the security pretty quickly. This makes me believe that there is something wrong with the car causing them to opt to pass on its siezure).

Some things to consider:
1) What condition is the car in? If in decent shape, he should try to sell privately for the best return. A dealer will wholesale offer on the car for low-bucks.
2) You do realize that your son might still be liable for considerable costs even with a 'voluntary' repossession. The creditor will sell the recovered car at an auto auction. Auctions do not recover full market value normally, so your son will be liable for any remaining debt. For example: car 'books' for $4k, son owes $5k. Car sells at auction for $3k (plus $500 expenses), net $3.5k. Your son still owes the finance company $1.5k ($5k owed, less $3.5k recovered).
3) Also, as you noted, any repossession will hit the credit history.


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Steve Halket
Judgment Recovery of Houston
[email protected]
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This is my PERSONAL OPINION and is not legal advice! Consult your local attorney for your specific situation and laws!