March 14th, 2007 by Questions
I have a leased vehicle that i can no longer keep up payments on. So far, to date i haven\’t missed a payment, but other bills are suffereing for this.
I would like to do a voluntary repossession and just hand in the vehicle as i can no longer afford it. I have 18 months left on the lease and can\’t get anyone to take it over.
I am contemplating filing for bankruptcy and may do so in a few months if things don\’t get better.
If i do a voluntary repossession, what will happen besides wrecking my credit (if i file for bankruptcy my credit will be ruined anways)? I am worried about being sued or them coming after any assets – i own a home but there is no equity in it. How long is the process for them trying to sue me or me having to go to court – will i still be able to file for bankruptcy after the fact?
2 Responses to “Voluntary repossession”
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March 15, 2007 at 8:47 am, A licensed trustee said:
Here’s what happens when you surrender a vehicle back to a leasing company. The leasing company will calculate the value of all of your remaining payments plus the contracted value of the car at the end of the lease and subtract from that whatever amount they are able to get for the car when they sell it auction. Don’t be surprised if this is a very large number.
The leasing company will then send you a letter demanding payment of that amount. They may negotiate payment terms with you, but they are not required to do so. If you are unable or unwilling to pay then the leasing company will probably sue you (and of course add the costs of the lawsuit to your bill as well).
At any time in this process you may file bankruptcy (or a proposal) and the debt to the leasing company will be treated just like your other debts.
Before you surrender the car you might want to speak to someone directly about your situation – use the links on this page to find a trustee in your area and give them a call. If you already think you may be in trouble then you probably are – talking thorugh your options with someone will help.
March 17, 2007 at 1:36 pm, Anonymous said:
Thank-you so much for your response – it helped me alot!
One other question – if they do sue us and sue us for the legal costs as well, how long does this process take? And secondly, is that like a judgement against us and if so, can we still file bankruptcy AFTER the judgement is made by the courts? Or do we have to file while the sueing is taking place? Does the bankruptcy take away all of the judgement including the legal costs?