Voluntary car repossession question

QuestionsVoluntary car repossession question
Janis Vernon asked 4 years ago

Hi trusty group,

 

I apologize this is going to be long-winded and slightly sporatic, per usual I want to cover all the bases.

 

I have a question about my voluntary car repossession. I was financing a car that I voluntarily gave back to the credit union before moving to Chicago, as I am living near downtown and can’t afford to have a car in the city, nor do I need one. After the car was sold at auction. The total owed on the car was $ 14,000, and it sold for $ 6,000. Obviously that leaves $ 8,000 give or take that is left over and I know is my responsibility. I had set up a payment plan through the credit union, but missed my January payment due to other bills. Right now I am a full-time student, but not elidgable for financial aid until the fall semester, so I am paying tuition plus my other bills on an $ 800 a month salary. My job does not allow part time employees to work more than 30 hours a week, and with school I don’t have time to find another job.

 

Anyhow, when I called the credit union today I got a huge lecture from the collection agent I have been working with, about how if I miss another pay they will need to charge off the account (which I understand why, I am not questioning him saying that) and it going to a third party company is literally the end of the world, according to him. I am starting to believe that he receives extra comission or something similar if they are able to keep the charge off in house, as if its charged off wouldn’t it be sold for less (pennies on the dollar in theory). He kept going on and on about how they don’t work with you to make payments and they will go straight to suing me and garnishing my wages and assets (what assets.. haha) and in the past, I have found none of that to be true as long as you work with them. 

 

That being said, I am wondering if that is necessarily true. The ding is already on my credit score since this account has been charged off, AND in addition to that, the credit union is unwilling to settle for less, they want the full amount regardless. I know hoping to settle for less is not fulfilling the debt 100%, but I am hoping to buy a house in the next few years and I would like to be able to have it considered settled in full, at the minimum. 

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