Legal Question in Credit and Debt Law in Georgia

Same result - you just save them the cost of a tow truck.

Neither. Both are complete catastrophes.

Either way, it is reported on your credit history as a repo. That pretty much ruins your credit for seven years, which affects not only credit but also getting jobs and your insurance rates.

Soon after the repo, they will sell the car at a loss and sue you for the large difference, adding in repo fees and other costs. So you'll owe close to the same amount, except you have no car. And they'll then grab your paycheck and bank account.

Before doing either foolish move, see a lawyer. If you truly cannot pay, consider bankruptcy. That may either save your car, or, if you return the car, will keep them from getting money from you (in most cases).

Attorney Ashman is correct. Whether you voluntarily surrender the car or they come and get it the effects are the same - its still a repossession. The lender can even assess collection costs as they must still retrieve the car from the dealership.

The important thing is the repossession and its affects. Once repossessed, the car is sold, usually at an auto auction, for a whole lot less than it is worth. The lender then adds in what you owe, plus sale and collection costs, and deducts whatever proceeds resulted from the sale. You are then responsible for any deficiency, so you are now stuck not having a car and having to pay for one anyway. Deficiencies are like other unsecured debts and can be negotiated. And the lender can't grab your paycheck until they get a judgment against you which does give you some time.

Repossession or surrender is best to avoid if you can possibly work things out or are able to sell the car for what is owed on it. If you are upside down, it may make sense to give the car back, but make sure that you get a new car and any financing in place before anything goes on your credit.

Failing all else, bankruptcy may be an option but whether you file or not is going to depend on your other debts and assets. Bankruptcy is not without its own consequences and will remain on your credit report 7 to 10 years from the date of discharge (the timespan varies depending on whether you file a chapter 7 or 13). Some people cannot file bankruptcy for whatever reason (usually they either have too many assets or cannot afford the payments under a chapter 13 or a combination thereof). If bankruptcy is not an option for you and you have to let the car go, I can help with any deficiency that results. I give free email consults. Please contact me at [email protected] if interested to discuss your options.