If you no longer can afford a car and want to surrender the vehicle how do you go about doing this?
by 
confused246
ANSWERS: 7
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When my wife and I were in this situation, we contacted the lending institution. After all, until it is paid off, it is technically THEIR car anyways.
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A voluntary reposession should be your last resort. Is there any chance you could sell the car yourself for the amount of the loan? The lending institution doesn't want your car, they want the money. Maybe they will work out some revised payment schedule. Even in a voluntary reposession, they will sell the car for what they can get, and you will still owe any shortfall. And your credit rating will take a hit. Talk to the lending institution right away, while you're still on good terms, and see what can be worked out. JCLOVESME, I'm not a lawyer or a banker, but to my knowledge, the answer is yes. If you fail to fulfill the terms of your financing arrangement (keep up the payments), at some point the financing company gains a legal right to take possession of the collateral (your car). If you keep it from them, you have essentially stolen it.
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As jalex noted, your best option is to attempt to sell the vehicle yourself for the best price you can get. His other advice is spot on -- as soon as you realize you are having problems with repayment, contact the lender and discuss your options with them. The last thing they want is for a loan to go bad; the next-to-last thing they want is to take possession of your car. They may be able to restructure your loan for you to make it easier for you to repay, perhaps extending the remaining repayment period. If selling the car to repay the loan is the only feasible option, they may be able to put you in touch with a dealer or broker who can help you.
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Basically I can afford the car but not the insurance on it. I have had some short commings and need to figure out what i need to do.
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Sorry, not quite right.In LAW the vehicle is to all intent & purpose owned by the LENDER where it is funded by way of a Hire Purchase or Conditional Sale agreement. The agreement is structured to specifically retain title in the goods in order to achieve this. Title remains with the lender until all payments are made & an Option to Purchase Fee made. This fee formally passes title to the hirer. The HIRER "owns" the car in "Possession" only as provided for by the agreement. This is similar to DVLA recognising the driver as the owner but no necessarily as the legal owner. The lender has certain rights to enforce the agreement which also include repossession - in otherwords to recover the goods that they own. It's not the same as home ownership by way of a mortgage. Suggest read the Terms & Conditions of the agreement - which most people fail to do before signing them!
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I actually have another question. Unfortunately, we are in the processes of a chapter 7 bankruptcy and have included the car. We called to try to renegotiate the terms and the lender is not able to get the payment low enough that it will work for us. I want to return the car to the bank and drop off the keys so they do not come to my house and pick it up and embarrass my kids. If I do this, do I need to write some kind of document stating my intent and vehicle data included and ask the bank to sign it like a receipt? Should I bring a witness or notary with me? Any advice is appreciated. It is a terrible thing to have to do and I want to make sure I do it in the proper way.
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Donate it to charity, Salvation Army or the local Humane Society. Call them and ask for details.
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