Quick Answer: Can I Hand My Car Back To The Finance Company?

If you return the car to the lender, the lender will likely sell it.

Often the sale proceeds are not enough to cover your loan balance; the remainder of the loan amount is called the deficiency.

The car loan lender can demand payment of the deficiency.

Can you return a financed car?

Unfortunately, yes, you may still owe on the car. Simply returning a car to the dealer doesn’t necessarily resolve whatever debt is attached to the vehicle. Regardless of the car’s condition or status, the lender still expects the loan to be repaid.

How do I get out of a car loan I can’t afford?

What To Do If You Can’t Make Your Car Payments

  • Modify Your Auto Loan. “One of the best options if you can’t make your payment and are in fear that you’re going to default is to call” your lender, Jones said.
  • Refinance Your Vehicle Loan.
  • Trade In Your Car.
  • Let Someone Assume Your Loan.
  • Sell Your Vehicle.
  • Turn the Keys In.
  • Let Your Car Be Repossessed.
  • File for Bankruptcy.

What happens when you surrender your car?

When you do a voluntary surrender, your credit report will report “voluntary surrender” on the auto loan account. Excess DebtIf your car sells for less than what you owe, that debt will continue to be reported on your credit report as an outstanding balance, which hurts your credit score.

How do I voluntarily surrender my car?

In voluntary repossession, you return your vehicle to your lender when you are unable to make payments. You inform your lender that you will not make payments going forward and that you want to surrender the car. Then, you set a time and place, you bring the vehicle (as well as a ride home), and you turn over the keys.

Can you return a financed car back to the bank?

If you return the car to the lender, the lender will likely sell it. The car loan lender can demand payment of the deficiency. If you don’t pay up, it can sue you, get a judgment, and then use various collection methods (such as wage garnishment or bank levies) to get paid.

How can I get out of car finance?

How to get out of your car loan

  1. Figure out your car’s current market value.
  2. Sell your car.
  3. Transfer your car loan.
  4. Refinance your car loan.
  5. Voluntarily give your car to your lender.
  6. Talk to your lender.

How can I get out of a bad car loan?

You can get out from under a payment you can no longer afford.

  • Refinance if Possible.
  • Move the Excess Car Debt to a Credit Line.
  • Sell Some Stuff.
  • Get a Part-Time Job.
  • Don’t Finance the Purchase.
  • Pretend You’re Buying a House.
  • Pay More Than the Specified Monthly Payment.
  • Keep Up With Car Maintenance.

Is voluntary surrender better than repossession?

Whether you return the car yourself or a repossession company is sent to get it, you are not repaying the debt as agreed. In the end, that is what lenders look at and what hurts credit scores. The benefit to a voluntary surrender is that you are proactively working with your lender to resolve the debt.

What happens if I can no longer afford my car payments?

If you owe less than the car’s value, you’ve got equity. If you owe more money on the loan than the car’s actual value, you have negative equity. You’ll pay off your loan and that’s that. There will be no danger of hurting your credit because of late or missed car payments.

What happens if you give your car back to the finance company?

You are unable to make the loan payments, so the lender is taking the vehicle back. The lender will resell the vehicle, and the proceeds will go toward the balance you still owe on the loan. If there is still a balance remaining after the sale and you don’t pay it, it could be turned over to a collection agency.

Can I voluntarily terminate my car finance?

If you haven’t repaid 50% of the total finance amount, you can still end the agreement early by paying off the difference. If you’ve already paid more than 50% back, you can voluntarily terminate your PCP agreement. However, you won’t receive any refund.

Can a financed car be returned?

And depending on the loan contract, you may be able to return a financed car and avoid credit damage. Review the auto contract. Depending on the auto dealer, you may be able to return a financed vehicle within a specific time period and cancel the agreement, usually within three days of the purchase.