1

I met with a gentleman from church today with a rather unique situation that I wasn't sure how to deal with. Two years ago he impulse bought a new car in IL @ 19% interest (poor credit) so he'd have reliable transportation for his kids. Within days he tried to take it back but the dealer wouldn't budge. Anyway, within weeks he lost his job and has not made a single payment! He recently got another job but only brings in about $800/month, and custody arrangements and school are keeping him from taking more hours or a different job. Ideally, he needs to get rid of this $25,000 vehicle and into something much cheaper but still reliable, but I'm not sure what he needs to do to get out of this. He's told the lender in the past to just take it, but nothing has happened. He said he's not even received any collection notifications.

  • 1
    @yoozer8 Not really. I don't see any of those as viable options. He doesn't have the income to make the payments, his credit score is way to low to get a different loan and he's way upside down since the car is now 2 years old yet the principle owed is the same as when he bought it. I would have thought they would have at least tried to repo it by now. – topshot Oct 28 at 20:06
  • @TomTom How do you suggest he force them to repo it then? There's no way he'll be able to pay this or any other loan for this vehicle for quite some time. Not sure what he'll do if and when they finally do since he can't afford any auto loan at this point, but he'll worry about that when the time comes. – topshot Oct 28 at 20:35
  • Bankruptcy. This is how society has agreed to handle people not able to handle their obligations. – TomTom Oct 28 at 20:47
  • 1
    @Fattie As stated, he's made NO payments on this new car. There was a downpayment initially, but that only affects initial principle for the loan. He doesn't have insurance either. He's been essentially homeless the past couple years. I wonder if the "bad credit" insurance policy that was part of the deal somehow paid this off??? I'd never seen such a thing (is it like PMI?), but I didn't read through the policy either. – topshot Oct 29 at 14:01
  • 1
    @topshot I may be reading too much into the question, and being overly cynical... but especially if this is a new(ish) acquaintance, be cautious if he follows up this tale of hardship with any kind of offer/suggestion/request that you somehow help him financially: whether that be lend him some money to "help me sort things out", or to buy the car from him, especially if it's at a "seems too good to be true" price. Of course, he could be a genuine person in genuine hardship, but if the contact had been over the internet, such a tale would scream "scam". – TripeHound Oct 30 at 22:12
3

If you owe 25,000, you're a bad person.

If you owe 25 million, you're the bank's best customer.

If you owe 25 trillion, you're a government.

If some bank / credit company was idiotic enough to loan the fellow the money, that company will have to deal with it.

OP reports that they have not received "even one collection notice".

They should just continue to do nothing, drive the car, and go about life.

The worst thing that can possibly happen is someone official-looking will come and take away the car.

If they literally cannot make the payments - literally, what other option is there?

Maybe in the future the person will be able to resume payments. Maybe the person will die, win the lottery, get a better job, or maybe the horse will talk. Who knows?

The simple fact is if they literally cannot make the payments there is literally no other option, than to just carry on.


Note that since the loan is incredibly upside down, there is absolutely no possibility to "change to another car". Forget it. Drive safely.


As stated, he's made NO payments on this new car. There was a downpayment initially, but that only affects initial principle for the loan. He doesn't have insurance either. He's been essentially homeless the past couple years.

The "only leverage" the finance world has over you is that it can "ruin your credit". Evidently that is a non-issue in this case. There is just literally nothing they can do. They've made no-faith efforts at all to even contact. There is literally nothing "bad" that can happen to the person in this case.

It sounds like a huge corporation was stupid enough to give the person a loan, as part of their desperation to drive lending levels as high as possible. Person should just continue as he is doing.

| improve this answer | |

Not the answer you're looking for? Browse other questions tagged or ask your own question.