To make a long story short I made a huge mistake, I financed a used 2006 vehicle in October of 2017 at 26.13% interest the price was $20,000 as the vehicle stands it currently values at $15,000 according to KBB.

I don't know what came over me and why I signed the papers. I'm not even sure why the loan office approved me in the first place how can they expect someone to pay that much interest and not default?

So at this point I am wondering if it's even possible for me refinance for a lower rate? Worst case scenario if I decide to do a voluntary repossession can I be sued, or can I just ignore the harassing calls and letters and live in squalor the rest of my life, I doubt I'll ever be able to buy or rent a house if I do that. I don't know what to do.

Can I go back to One Main Financial and persuade them to give me a lower interest rate? 26% is legitimate robbery when I heard that I didn't understand how APR was calculated so I'm basically paying $19,000 to finance a $20,000 vehicle.

  • 2
    "and threaten to kill myself if they don't give me lower interest rate?" Have you tried going to another bank and refinancing without the melodrama and histrionics?
    – RonJohn
    Commented Jan 14, 2018 at 7:47
  • How much do you currently owe on the car?
    – Ben Miller
    Commented Jan 14, 2018 at 8:05
  • 1
    You said you bought the car for $20k. How can the balance of the loan be $37,200?
    – Ben Miller
    Commented Jan 14, 2018 at 13:21
  • 9
    Even if you made no payments and interest was compounded continuously, you should have only accrued about $1350 in interest in just 3 months. How do you owe $17000 in interest? Are you talking about how much interest you will have paid by the end of the loan? Don't; future interest is irrelevant to how much you owe now.
    – chepner
    Commented Jan 14, 2018 at 16:19
  • 6
    @justatreeguy Serious comment: If you are at all considering harming yourself please first call a local hotline which will connect you with a real person that you can talk through your issues with. No amount of financial distress is worth killing yourself over. There are many such lines, but if you are in the US you could try 1-877-235-4525, "Hopeline". Commented Jan 15, 2018 at 14:22

1 Answer 1


Sell the car.

This car is too much for you to handle. Yes, they have you at an abusive interest rate, but even at a low interest rate, you would be having trouble making payments, and you would have spent too much on a car. Refinancing doesn’t fix that. Get rid of it.

Since you are upside down on the car, you’ll still owe money when you sell. But it is much better to be $4,000 in debt then $19,000 in debt. Can you come up with $4k? If not, talk to the bank and see if they will allow you to sell the car for $15k and borrow the rest. Explain to them that you are having trouble making payments. If they don’t like this idea, go to a local bank or credit union, explain the situation and see if they will loan you the difference.

If all else fails, make this loan your top priority. Cut all expenses you can and throw every penny you can come up with at this debt. After you get to the point where you owe less than the car is worth, you can decide if you want to keep doing what you are doing to pay it off (and continuing to try to refinance), or sell it. Selling it is probably the smarter decision.

  • I'd much rather sell it than let the lender auction it for pennies on the dollar. should I apply for the additional loan to cover the difference before i sell it or sell it then apply and pay the lender back? and will this harm my credit score substantially? i'm at 650 right now and I'm interested in buying a small cheap house under $30,000 and this vehicle is making it impossible, I have a reliable beater car to drive in the meantime, I just lost sight of my values an let materialistic desires get the best of me. I just want to be sure I can get approved for a home, and learn from my mistake Commented Jan 14, 2018 at 8:54
  • Also Do you have any tips on selling a vehicle with a lien? Commented Jan 14, 2018 at 8:54
  • 8
    @justatreeguy In my opinion, you aren’t ready to buy a house. You are having trouble making payments on a car, you will have trouble making payments on a house. Don’t worry about your credit score; just work on getting out of debt, and the score will improve once you do that.
    – Ben Miller
    Commented Jan 14, 2018 at 13:25
  • 1
    @justatreeguy I think you’ll need to have a plan in place to pay off the loan before you try to sell the car. Talk to your existing lender to see if they can work something out. If not, then talk to local banks and credit unions to ask about a small loan to cover the difference.
    – Ben Miller
    Commented Jan 14, 2018 at 13:27
  • 1
    @Lawrence I think what Ben means is unless or until the OP can get financing for the difference, throw everything at the old debt. If OP can get finance for the difference, fine, but if not, as soon as OP is ahead on the loan (the proceeds from selling will pay off the outstanding loan) then sell.
    – TripeHound
    Commented Aug 28, 2018 at 9:33

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