Note: The DearEsq free 'ask a lawyer' site is offered as a free informational service to the public and is not intended as legal advice. Laws vary from state-to-state, and in addition every situation is unique, and relevant facts may not be known. The answer to the question posed below may not apply to in your state or to your situation. For legal advice in your state and your situation you should consult with an attorney in your state who is familiar with the rules and laws in your state.
“I’ve been to several dealerships in an attempt to get rid of my car and get into something more reliable and I keep getting the same advice. Because I owe $15,500.00 on a car with a trade in value of $5,000.00, I’m being told to just give up my car and start over again. If I were to surrender my car to the bank, what would happen and for how long would I be harassed by the bank to get the rest of their money back?”I’m guessing none of the people giving you advice are people who work at your bank.
Question: Consider this: Your bank is expecting to get $15,500, and you give them a car worth $5,000. If it were you, wouldn’t you want the other $10,500, too? So will the bank. In fact, they may not even want the car in the first place: Banks are in the business of lending money, not selling used cars.I can’t say exactly how (within the law, of course) your bank would go about trying to collect their money, but five figures gives them quite a bit of motivation to get what they can instead of just writing it off. I wouldn’t expect them to go away quickly.
Answer:
I’d like to offer some advice, but when a car loan is “underwater” by that much, there often isn’t much you can do until it gets paid off. Unless you can wrap it into a mortgage or borrow from relatives, there may not be a cheaper way to deal with it than just to pay it off.
