Well thats the problem, she has taken a HUGE pay cut at work, and has tried cutting back where she can, but will only be able to make a couple more payments before she is outa cash.

Chingchonger: That idea is very tempting, but i dont think she wants to go to jail over this. lol.

 

A few years ago (ok..also 3 weeks ago) i was given some offers to make my car ''disappear'' while i slept. I am not into fraud and didnt feel like paying a ''disappearing '' fee . People like to yap and things slip out...friends sometimes become enemies....so i decided to be an honest schmuck and just pay down my bills. '' seek and you shall find''.

 

Thanks for the support, Chooch.

But, the bold type portion of my post was from an08hhr. When I copied it, I omitted the credit. My bad......his suggestion, which I was supporting.

 

The 07's just went to the 'zero' % from 4.9% in the last few days in the States (the north central- east area) but she got suckered in before that by a money grubbing salesperson. The question is now, can she get refinanced and not ruin her credit or lose the car. I have been watching for a couple yrs to see if GM has a pattern which they do but not sure of the exact time. Hope it works out for the good, you learn some rough lessons in life the hard ways at time.

 

Notice with 0% offers they say "For well qualified buyers" in small print. You aren't going to get 0% unless you have a perfect credit history and a FICO score of like 700 or over. 0% is impossible for people with bad credit, slightly blemished credit, or are just establishing credit such as first time buyers.

 

+1

It is very difficult to get a loan with prime rates if you have toilet credit. We called it "tore up from the floor up" when I was in the biz.

You didn't mention how much was financed, the payments, or the term, so I'm otherwise not able to give you much advice there. If she does want to get out of the car, things like GAP insurance and extended warranties are refundable and can cut out some of that principal.

I'd say tighten the belt. A repo will kill your ability to get any loan under 20%. If you aren't making enough money, get a second job. If you're living beyond your means, see a credit counselor. Sometimes people just get stuck and you gotta dig yourself out before the trench caves in.

 

This was my situation, First of all, there was NO WAY I could afford a new car, as I am on a fixed SSI income because of my handicap.

Because of God's love and compassion, I was blessed with extra income through friends of family who knew my situation....

I took a look at an HHR (now named Wheelie) at a dealership, and within 2 hours, I put a $10,400 down payment on Wheelie and financed the rest of the Wheelie's price through my mother's bank.

I Financed about $8500 and now I have been paying $169.22 for 18 months now, plus 2 EXTRA payments, I now owe about $5300 on Wheelie and I plan to make 6 EXTRA payments next month, so I can knock off a half yr of car payments, Ultelmently paying Wheelie off in about 2 yrs

 

i paid a one time fee of $15K

 

If you're a first time car buyer, you have to pay the price to establish credit. We all did it. I know that doesn't help the situation but you have options.

1) reduce expenses by getting a roommate, carpooling, etc.
2) refinance with a co-signer at your local credit union. They will usually give a new car rate for up to a year. And don't ever go 72 months again. You can never get out of an upside down situation with that loan.
3) find a new job that pays more or get a second job

Many of us have difficult financial situations but we learn to work through them. I was making only a median middle-class salary but qualified for 0% financiang due to years of managing my credit properly. That is, I pay my bills on time, have only a few credit cards, and don't spend more than I earn. You buy what you need, not what you want!

And don't think buying a new car was a mistake. She would have gotten a worse interest rate on a used car.

 

Forget going back to the dealership. They don't care about you or your situation. They just want to sell you another car.

You need to find the RIGHT person at the bank to speak with. Banks are in the business to make money on loans. They are making GOOD money on your loan, BUT they LOOSE money if you default. The loan is worth more than the car is worth; if you default, they will have to wholesale the car out, which is LESS than the lowest Kelly Blue Book trade-in value. To make it worse for the bank, the HHR is a "speciality car", in other words, it does not have broad appeal like a Honda Accord or Toyota Camry, hence it WILL command a VERY LOW price at the wholesale auction (where banks send their repos). So here is my suggestion:

1) Do your homework. Find out what the HHR would get at an auto auction. The rule of thumb is that it will be 20% LESS (because it is a "speciality car") than the Kelly Blue Book Trade-in value for a car in "good"condition (even if it is in 'ecellent' condition).

2) Get the trade-in number, write it down, and if you can produce any written evidence of what it is worth, bring it with you. (In fact, print out the KBB value from their web site; also get the trade-in value from a few dealerships; bring with you the LOWEST written trade-in value.)

3) Contact the bank and find out who the most senior decision maker at the bank. Be very polite and professional. You may have to go in and speak with a few folks before you meet the right person. Be persistant, yet stay VERY polite and professional in your converstation. DO NOT agree to speak with someone over the phone, you need to have face-to-face, eye contact meeting to explain your situation.

4) Now comes the moment of truth. You have all your documentation. You present your situation in this manner: You explain to the bank that your job situation changed and you are now going to have difficulty meeting your obiligation. (NOTE: It is important that you explain that you are GOING to have difficulty, not that you are having difficulty NOW, but that it is forthcoming as your income has changed. Most banks appreciate a customer being PRO-ACTIVE about their upcoming financial down-turn; to them you are showing responsibility in coming to them before you may default.) You explain you do not want to default because EVERYONE looses; you loose with a negative on your credit rating, and the bank looses because the value of the car is MUCH LESS than the loan amount (show them the supporting documentation). Then you tell the bank EXACTLY WHAT you CAN afford in monthly payments (HAVE THIS FIGURE READY WHEN BEFORE YOU WALK IN) and request to renegotiate the loan, either at a lower interest rate or longer term. You may end up staying at the same interest rate, but a longer term loan, and this is OK becuase: If you can live with the new payment, you can pay the car down for a couple of years and then trade the car in, or sell it. REMEMBER your short term objective: LOWER THE CAR PAYMENT EACH MONTH.

During your conversation, be polite and professional. Explain you want to keep paying the bank, you want to continue to be a responsible customer, and you're coming to them to lower the monthly payment because you have had an unforseen down-turn in your income and you didn't want to default on the loan.

Why am I suggesting this course of action....because in 1990, this happened to ME! I did everything above and the bank was estatic that I came to them BEFORE I started to be late with payments, BEFORE I possibly defaulted. They said I showed reponsibility, and they renogotiated the loan, not the rate, but the term. They also gave me relief for 90 days (no payments) and tacked that on to the loan term so they extended my 36 month loan by 27 months. It took me an extra two years to pay off the car loan, but the monthly payment was less, the bank made more money in the long run, my credit remained strong, and I have had a long, solid relationship with this bank ever since.

You have nothing to loose in trying this route. If they say "no", you are right where you started (albeit, not a good place), but if the bank says "yes" to the new payment you are requesting, HOORAY!! It is worth a shot. It worked for me.

Sincerely,

MWG2