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Dear Bankruptcy Adviser,
My wife and I filed for Chapter 13 bankruptcy that was converted to Chapter 7, which was discharged in February 2008. We tried to reaffirm both of our autos, and the bankruptcy judge would not allow it.
We had been continuing to make payments, and my wife’s car is now paid in full. However my auto is not, and I noticed on my credit report the account is listed as closed. I am still making payments on the car and still have possession of the car. (more…)

Dear Terry,
I am leasing a 2007 Volkswagen. In November 2007, VW apparently revoked the dealership license from the dealer. The closest dealers are now an hour away, which is obviously an inconvenience for servicing. Is this sufficient grounds for asking out of my lease?
— Jeff

Dear Jeff,
Sorry, but you can’t cancel a lease simply because the dealer isn’t close by.

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Dear Terry,
I would like to refinance my vehicles to lower my interest rate. However, I owe more than what they are worth. Would any company still refinance them anyway? We have excellent credit.
— Heidi

Dear Heidi,
With good credit, even in a tightening credit market, you should be able to refinance your car. Whether you can lower your interest rate will depend on how long the loan term is and where auto loan rates are sitting. (more…)

Dear Terry,
My mother purchased a car a little over a year ago. She has fallen behind on her payments due to disability. Can I assume the current loan under these circumstances? I’m definitely willing to make the payments in arrears and bring the loan to date.
— Kelvin

Dear Kelvin,
Contact the lender and tell them you want to bring the loan up to date and will be making the payments going forward. The lender should be happy to hear that. (more…)

Dear Terry,
I purchased a car on Friday. The dealer told me he didn’t have the white car I wanted, but that he would take some money off a blue car he “thought was on the lot.” He sent his salesman out to look for it and then said it must be on a truck that would be in at 12 that night. He gave me a car to drive until next day.
Now, days later, there’s still no car and his “Mr. Nice Guy” attitude has changed. He says I will have to deal with the delay. Since I never took ownership of the car, can I back out?
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Dear Terry,
I have a 2000 Toyota Corolla that I have had for almost three years. I am looking into trading it in, but I don’t know how to go about it without having to spend $10,000 to $15,000 to do so. Unfortunately, I have a bad credit score. I am wondering how to go about this.
— Jennie

Dear Jennie,
Do you owe anything on the Corolla? When you mention $10,000 to $15,000, is this the difference between the value of your Corolla and the new car you want to buy?

With a poor credit score, my suggestion is to hang onto the Toyota, clean up your credit score over the next year and then look to trade.

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Dear Terry,
After bankruptcy, my car was returned (on paper) to the finance company that held the title and the loan was written off. The bankruptcy case is over and everything has been settled.
The car is no longer registered or insured by me and I was told the finance company would pick it up soon. It has been sitting in my garage for four or five months. I called and they said they don’t know what to do since in most cases they just refinance the car with the original owner. I cannot drive it to them since it is neither registered or insured. (more…)

Dear Terry,
I live in California and the mortgage company I worked for closed. I have found new, lower-paying employment, but have fallen behind on my car payment.
— Laura

Dear Laura,
Has the car been repossessed already? If not, talk to your lender. Because you have a new job, the lender may be willing to refinance the vehicle for a longer term to lower the payments.

If it has been repossessed, the lender, or its collection agency, always has the right to seek payment for the difference between what the vehicle fetched at auction and what you still owed, plus legal fees and interest.

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