How bad would it look on my credit report if I turn in my car?

I can not afford to pay my car loan anymore, so far my payments have all been on time and my credit is good, never missed a payment on any of my accounts, but I can't afford my car right now, how long would it be on my report if I voluntarily surrender my vehicle? Can I get a new car again? When? HELP!

How bad would it look on my credit report if I turn in my car?
Repo's can really mess up your credit report and your pocketbook.





When they repo the vehicle (even if you turn it in it is still considered a repo) they will show the tradeline as a charge off. Then after the deficiency sale, they will probably add the deficiency as a separate tradeline. Then if they sell or assign it to a collection agency, they will add a tradeline. Then if you are sued for the deficiency and lose, the judgment will be added.





Having your credit report trashed is just the start of the bad things to come.





When they repo the vehicle they will sell it for roughly 50% (more or less and likely less) of the book value of the vehicle, not what you owe on it.





Then they will add the repo fees on top of that amount. The fees could run up to $1000. or $2000.





Then they will add interest to the total until it is paid. If not paid they may sell it to a collection agency or sue on their own. If the collection agency gets the account and cannot collect the amount due they may sue. So you would have court fees added to it if they win. Then you would have court ordered interest added to the balance until you pay it.





For example, say you owe $10,000.00 on it. The book value says that it is worth $8000.00. It could be sold at repo auction for $3000 to $5000 more or less, probably less. That could leave you with a deficiency balance of $5000 to $7000. Then with the repo fees and interest added to it, you could easily be looking at having to pay almost what you owe right now - without having the vehicle if you pay the deficiency. (and this is even before a suit being filed on it)





I would suggest doing as the others have mentioned and see if you can re-fi it at a lower interest rate first.





If you simply cannot afford to make the payment, you would probably be better off selling it yourself, even if you have to take a small loss, which you would have to make up and pay to the creditor at the time when you sell it.





I don't mean to sound so harsh and negative, but repo's 'are' one of the worst things to try and deal with.





You might do some reading on the site I've listed. Even though it is from the Illinois Legal Aid, the basics of the information fits for no matter what state you live in
Reply:Having a repossession is never a good thing.


You may be able to get another car eventually, but it will require a high down payment and will have a much higher interest rate.


Depending on how long you have had the car and what you owe, it may be possible to refinance the car for a longer term and make the payments lower.
Reply:you should talk to your finance company and see if you can't work out a deal with them. Maybe they will let you refinance it and lower your payments to where you can afford the car. If you turn it back to to finance company you could be responsible for the remainder of the debt anyway. Some states have a law that says the finance company can sell the cat and you have to pay off what ever the sale did not pay.
Reply:It will Still go on your report as a Repo and will stay for 7 years.or at least that's what happened to me,I turned one back in never late on a payment,husband passed away I could not afford the payment and it ruined my credit,for 7 years and I still have not fully recovered.