How to Return a Car to the Finance Company
Sometimes a car owner wants to get rid of vehicle he is still financing. If the car is financed through a bank or finance company, the lender may take the car back without penalty. In other cases, the lender will accept the car but still try to collect on the car loan. If your payments are beyond your budget and you wish to return your car, you must act carefully to save your credit history and avoid legal action.
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Instructions
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Review your purchase agreement and loan paperwork. You may be able to return your car to the dealer after a specific period of time. However, this is usually only a few days after purchase. Your loan paperwork may have a similar clause, giving you the opportunity to opt out of the financing.
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Tell your lender you want to surrender the car, even if your loan paperwork does not allow it. Depending on the condition of the car, your lender may be able to sell it quickly and allow you to cancel your loan.
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Try to sell your car back to the dealership or seller. If your lender will not let you out of the contract, ask the dealership to attempt to sell the car and use the funds to pay off your loan, keeping any profit. But be prepared to pay the difference between what the dealership gets for the car and what you currently owe the finance company.
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Consider a voluntary repossession. This involves explaining to your lender you no longer will make payments on the car loan and would like the repossession process to begin. Again, your lender will try to sell the car at auction to recover what it has lost on your loan. And you may have to pay the difference out-of-pocket.
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Tips & Warnings
Always speak to your lender and dealership before proceeding to avoid negative marks on your credit report.
References
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- Photo Credit car key and remote control isolated image by Nikolay Okhitin from Fotolia.com
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Comments
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How legal is it for a new vehicle to make purchaser assign the manufactures rebate back to the dealershipthus making the rebate n on-existant for the purchaser which raises the price.
