Getting Rid of a Worthless Car

[HeyHomie]

I have a car that is worth less than what I owe on it. I have about three years of payments left on it, and I have serious doubts about it lasting through the winter, let alone for three more years. For reasons that are too complicated to get into here, I can't trade it in, either. Basically, the dealers have told me I'm stuck.

I've thought of four possible ways to get rid of this lemon, all of them bad.

1) Arrange to have it "stolen." Major prison time if I get caught, and even if I don't get caught, my insurance rates would skyrocket.

2) Arrange to have it "totalled." Again, illegal and detrimental to my insurance payments.

3) Drive through the 'hood and hope somebody carjacks it. Not illegal (on MY part), but definitely dangerous, and again, expensive (from an insurance standpoint).

4) Call the bank and tell them it's theirs if they want it (voluntary reposession). Costs me nothing, but would permanently damage my credit rating.

Anybody else have any ideas?

[HeyHomie]

Clarification to point #3 above:

There's also the possibility that the police may find it and try to give it back to me! Kind-of a "Ransom of Red Chief," only with a car.

[Temujin]

Donate the car to charity.

In some cities, there are organizations that take donated cars, fix them up in order to train people for wor, and sell them to help finance their non-profit organization.

Best of all, you get a nice deduction for your income taxes.

Your accountant might be able to recommend an appropriate charitable organization in your area.

[Temujin]

(that should read: ''train people for work'')

Putting aside the legalities of having the car stolen or totalled deliberately, I gotta tell you that wouldn't get you off the hook anyway. If the car was totalled, the insurance company would pay "fair market value" to the lienholder (the bank), and the bank would then come after you for the difference. (The husband of someone who posts on this board IM'd me with this exact question yesterday, he having totalled his car a while ago.)

'Bout the only thing you can do is sell it, maybe get somebody to take over payments. Even that is likely to leave you with a shortfall though. Next time, buy a "pre-owned" car. They don't depreciate a few thousand dollars as soon as you drive 'em off the lot.

Good luck!

-Melin

[Gaudere]

5) Sell it for less than it's worth and suck up the loss. (bad)

6) Donate it to charity and get a tax write-off. (worse, except for warm fuzzies)

It is not under warrantee and you still have 3 years on your payments? Wow, *long* payment term. You could buy an extended warrantee if you are sure it's going to crap out this winter.

If you owe more than it's worth, they call it "upside down". Your trivia for the day.

------------------
"Happiness is nonetheless true happiness because it must come to an end, nor do thought and love lose their value because they are not everlasting."
- Bertrand Russell

[Satan]

Well, as far as the option to turn it back in, I did that when I moved to NYC when I still had a lot of payment left on my car.

What they do is auction it off and charge you the difference, allowing a payment plan to be set up with the usual interest.

Even if you do all of this, you will STILL have a reposession on your credit. I know... You can then put in a consumer comment to all three credit agencies and explain the situation, and it'll help somewhat, but again, you have to pay off the difference to make it even palpable.

So, you wind up paying many months for a car you're not driving anyway. Not a good thing unless you're rich, and judging from your tone, you ain't!

Legal option is to go to a dealer who claims to "take any and all trade-ins" in advertisment. Usually you will find a dealer who will rip you off (to a degree) but will buy your car for you. It would help to have a few bucks to alleviate the dealer - maybe three or so payments.

In the you-didn't-ask department, it seems like you bought a car that sucks. Many states have lemon laws on the books and not only for new vehicles. Check into the laws in your state about this. You might be able to get out of this with no problems if you're lucky.

------------------
Yer pal,
Satan

[Omniscient]

I second that. Do some serious research on the Lemon Laws in your state. Illinois has some pretty sound ones last I heard. And if the car has depreciated faster than your payment plan (assuming you didn't sign up for a 15 year plan) you certainly bought a lemon.

[Louie]

If you are going to sell it, sell it for parts. It's worth more to sell the car for parts than to sell it to someone else.

BTW, what car do you have?

[Louie]

:P Nevermind about selling it, I didn't see that you still have payments on it.

Here's some links to lemon laws if you're interested...
http://autopedia.com/Lemon/ http://www.autosafety.org/ http://www.mindspring.com/~wf1/ http://www.carprices.com/vendor/carfax.html (check the history of your car thru Vehicle Identification Number)

Asking again, what car do you have?

[pmh]

I agree w/ Satan and Omni. However, if the lemon laws fail you, fix the car. Unless the body is gone, it CAN be fixed. It may cost more now, but in the end you'll be glad your credit is still intact.

A couple of low $$ options:

1) Check out the salvage yards (they get REAL snippy if you call them "junkyards") for used parts. You can get a low milage motor/trans from a wrecked car for under $1K and if you swap out the whole deal, its real easy. Just go to the library and check out the Chilton/Haynes/Motor manual for your car. You can do it over a weekend easily (no matter how clueless you think you are).

2) Call the local community college/trade school. If your car is fairly new (~94 up), they may let the students work on it for the experience (you pay for parts).

(FWIW: can probably help more if you post make/model and symptoms.)

Good Luck.

[pmh]

Oh yeah, I secon Melin's suggestion as well: Never buy a new car.
(IMHO the US has not produced a decent passcar since '74 anyway.)

[pmh]

DAMMIT.
1st post: ...it's real easy...
2nd post: ...second Melin's suggestion...

Good night.

[AWB]

Car dealers in the DC area have been paying off liens on trade-ins "no matter how much you owe". Of course, they just tack on that amount to your new loan. But this pays off your old lienholder
gets rid of your lemon
gets you a new car, although your payments are higher than they would've been otherwise.

For the money, get a Mazda Protege. Mine's been a dream.

[HeyHomie]

To those who asked what kind of car I have: It's a 1996 Plymouth Neon. I didn't buy it new. It was a "program car." It had been a rental and had amassed 9,000 miles in about 6 months when I bought it.

I've had nothing but problems with it since the day I bought it. It was the first, and DEFINITELY LAST, time I will ever buy an American car.

[neuro-trash grrrl]

You bought a brand-new NEON!!? Well, you're going to heaven when you die, because you have suffered enough in this lifetime.

------------------
Modest? You bet I'm modest! I am the queen of modesty!

[Satan]

But doesn't it look cute as a button on the side of the road with it's hazards on?

[RTA]

Why, just yesterday I got rid of a worthless car with lots of mechanical, electrical, and cosmetic failings. It was worth at MOST, MAYBE $450 on a good day.

The outfit I donated it to (which I found through the local Veterans Administration hotline) are sending me the appropriate IRS form, and have told me that I can write in any amount between $600 and $1700 for it! These numbers come from a sight-unseen interpretation of blue book value. By next April 15 that car will most likely be melted down or in a thousand pieces.

So my current plan is to claim $1700 for it and use the money I save to celebrate the fact that that piece of crap car is out of my life forever.

[RTA]

I should add that donating that car was the easiest thing in the world to do. A man in a tow truck pulled up; I signed away the title, handed him the keys, took a receipt, and didn't stick around to watch him drive away. The whole thing took less that 5 minutes.

[metroshane]

sorry about the lemon. but first, you can't swear off american cars just because you bought a trashed version of one of the cheapest models of a company that has only been making decent cars for 5 years. besides, my camaro was built in canada and my mom's toyota was built in ohio. Plus, there isn't an american engineer in the whole bunch (gross exaggeration).

and the option of having it stolen, let me tell you a story.i had a friend who tried this, but didn't destroy the car. the police found it a couple weeks later and gave it back to him stripped!!!! he had to keep it.

[cornflakes]

What is the matter with the car?

[tracer]

pmh wrote:

1st post: ...it's real easy...

Since you're going back and fixing typos, shouldn't that be "it's really easy"? ;)

------------------
Quick-N-Dirty Aviation: Trading altitude for airspeed since 1992.

[tracer]

metroshane wrote:

you can't swear off american cars just because you bought a trashed version of one of the cheapest models of a company that has only been making decent cars for 5 years.

Yeah. Saturns actually have a decent reputation for reliability. I bought my 1993 SW-2 in 1996 with 60,000 miles on it, and the only failures it's had were the power door locks, a dead battery (and those things only have a 3-4 year lifespan anyway), and the fuel pump. Of course, the fuel pump would have to conk out on me 20 miles from nowhere on a 400 mile road trip late Christmas Eve to be with my parents for Xmas, and it would have to be positioned so that you had to remove the gas tank to get at it (which none of the little service stations open Xmas weekend could do). Not that I'm bitter. Ooooohhhh no. Saturn couldn't've just put the fuel pump a LITTLE farther forward so you could get at it with a screwdriver, could they? Noooooo. They might have to move other stuff forward then, and THAT might force them to sacrifice some of that totally unused space in the front of the car that makes it look pointy! I swear, the next car I get's gonna be a Toyota Corolla. Man, those Toyota engines last forever. Um ... what was my point again?

------------------
Quick-N-Dirty Aviation: Trading altitude for airspeed since 1992.

[Mazey]

I'm guessing there's nothing wrong with the car other than it's a dog and worth far less than you owe on it. Sad twist of fate. Talk to the lending agency; see what they'll take to "pay off" the note, and see what you can get to get rid of (sell/donate) the car.

Keep your credit clean; get a used car that will keep running and remember the lesson.

The lesson? Watch out for those lovely low-payment plans on car purchases. Sure, your car payment's really small, but your balance stays high, the interest adds up, and all you've really accomplished is paying against the interest...which leaves you holding a bunch of car payment coupons and a dog of a car. This is especially sad if the car is totaled in an auto accident. Your car on which you owe $5,000 is worth $1,000. That's all any insurance company owes you...fair market value.

**side note about donating the car. Do you REALLY think the IRS is going to believe your $1,000 car is worth $5,000 if you're audited? Think again!

------------------
"There will always be somebody who's never read a book who'll know twice what you know." - D.Duchovny

[MadPoet]

Important bit on donating cars: I donated my car to a "charity" and wound up close to screwed. They fixed it and sold it to someone who drove it to Seattle and abandoned it. Since I was the last owner, I would have been stuck with the bill, had I not had paperwork showing that it had been signed over to the "charity" (in quotes because the least charitable thing I could imagine to wish on someone would be to sell them that car... crashed it once and it was never the same. Worked fine if you never let it come to a complete stop.)

------------------
---
MadPoet

[voguevixen]

Alas, I can not help you with your current problem, but can only make suggestions to help you avoid future ones.
#1) Consumer Reports (magazine) puts out a car issue every year with brutally honest assessments of the current year's cars as well as how the cars of the past 10 or so years are holding up. They take no advertising and have no prejudices regarding foreign vs. domestic cars so they'll tell you which are the best of the bunch and which are crap. They'll also break down who's really making what (i.e. Audi is made by Volkswakgen, etc.) so you can get a car that is similar quality to a luxury "name" at a much lower price.

#2) There is a very easy way to buy a car with absolutely no interest or payments but for most people is very very hard. It's called saving your money and paying cash. The upside of this is that not only are you saving the money you'd be paying out in interest on a loan or lease, but this gives you negotiating power like you wouldn't believe. It's true that the car dealerships make their money on financing but the actual salesman makes the money on what he sells then and there. Last year I was able to buy a brand new '98 Civic for around $300 over dealer cost because I waited until the 99's were coming in and I knew the guy wanted that '98 off his lot and my cash in his hand.

#3) Never lease a car. Could someone explain to me the reason for this? I really really don't get it! You pay all this money into a car and then have to give it back? With nothing to show for it?

#4) DOn't listen to other people's advice about cars, it will just mess you up. :) Really, if someone tells you "don't buy a new car because they depreciate too much" and you have no mechanic skills, how are you going to keep up an old car? Now my HUSBAND is like the car miracle worker. He bought a 1972 Datsun pickup a couple of years ago for $500 to hold him over until his next car. Now, you couldn't pay him enough for it. Every time I think it's finally expired he goes to the auto parts store and spends $50 and manages to fix it right up. The thing is, while I may be comfortable changing my own oil or adding anti-freeze, messing with the clutch or heaven-forfend the BRAKES is just beyond me! When you're buying a new car, you're also buying the 5 or 10 year warranty that you won't have to sweat something like that, which I feel is worth the extra $$$ in the long run.

#5) Oh look! My cocktail glass is empty! I guess I should quit rambling and let someone with something worthwhile to say have a chance, sorry to be so longwinded... ;) Keep us posted on what you end up doing and how it turns out.

[pmh]

voguevixen,

I agree/disagree.

1) CR is an invaluable reference, but they do favor foreign makes. They also tend to value comfort/appearance above performance/reliability in their "overall" ratings.

2) I agree in principle. Occasionally though, you can get a lower interest rate than you are earning on your CDs. Then you should definitely finance (they usually only offer this rate for a 12 month term).

3) Why lease? Because you can beat the hell out of the car and return it before it dies completely (apparently the case for the Neon in question). I agree that financially it it pretty stupid though.

4) Again, I agree in theory. However IMHO you pay about 4X what that convenience is really worth.

5) Hmm... Me too.

rastahomie, seriosly, let us know how this comes out.

[kellibelli]

I know almost nothing about cars...but:

1-small cars age faster than big cars.

2- 6000 miles in six months.....what were you thinking???

3-Those little plastic disposeable cars are a poor choice unless you have a warranty.

4- if the damn thing runs at all, just keep fixing it.find a cheap (unliscenced ) mechanic with a good reputation, and get him to patch it together, it should hold till the payments are over.

People who drive 'new' cars are pretty spoiled (no offence meant) a half decent used car can run for years...so its not GREAT, but hey...gets you there...Take my old '79 Buick for example...do you think winters are easy in maritime canada?Snort! Not a bit! But with the help of a good mechanic, it runs ok, and has saved me a car payment for the last few years. In the spring, I plan to retire the beast and purchase another old relic, for maybe $1500-$2000 at the most, and I'll get years out of it.

There is NO way I could afford a car payment, and my car insurance is only $40 per month.

[Torgo]

Whew. This makes the $1600 I just shoveled over for my recent repairs seem like a cakewalk.



------------------
Tim
"My hovercraft is full of eels."