Question
I Cannot Pay my Truck Loan 17,000, What will be the Effect?
My husband bought a commercial truck for $40,000 ($20,000 down payment + $20,000 Loan with a fixed APR of 9%) on Jan. 2008 and had to let the financial firm take the truck back to resell because the income he made from the truck could not support the expense of the business. The financial firm sold it privately (which should be publicly) for $15,000 on Oct. 2008 and asked my husband to pay for the rest of principal plus interest in a total of $17,000. They noticed my husband that the interest was incurred from the day he borrowed the money and the APR was 13% (the matter of the incurred interest and the APR were different from what they told my husband). The financial firm transferred our debt account to the credit collection agency, and the credit collection agency transferred our debt to a law firm. Now, my husband will be called to the court next month because he was sued for not paying the rest of money by the law firm. Could you tell me what the effect will be? And what should I do before going to the court? Thanks! Your help is really appreciated!
6 months ago - 3 answers
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by Raymundo F
6 months ago
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The creditor will ask for their money, they may offer a settlement. When your husband cannot pay then the judge will impose a judgment and your husband's wages may be attached or your home will have a lien on it (if you own your home) The judgment will remain on your husband's credit for 7-10 years. A judgment is as bad as a bankruptcy so bankruptcy would protect you from having to pay the 17K. If you file right away, I think you can either take the BK papers to court with you or have the BK attorney contact the creditor and he wouldn't have to even go to court.
by kwsstin- 6 months ago
The result of the lawsuit will be that your husband will lose and the court will issue a judgment against him. He owes the money and hasn't repaid it, so he really doesn't have much he can say to defend himself. However, he should still go to court. He may be able to get the court to reduce the size of the debt. If he originally borrowed $20,000, and they sold the truck for $13,000 then he should only owe $7,000. Tack on 2 years worth of 13% interest and the balance is up to about $8900, that means they are trying to charge him around $7,000 worth of penalties and fees for missed payments, etc. That isn't right and he needs to demand an itemized list of all the expenses. He may not win the lawsuit but the court won't allow $7,000 worth of late fees. The fact that they sold the truck for $13,000 isn't really uncommon. This is why its always recommended that you try to sell a vehicle yourself instead of just turning it in. When you turn it in they re-sell it for much less than its worth, and you pay the difference, plus it still counts as a repossession on your credit history, so you really gain nothing. You should get a lawyer. Even though you can't win the lawsuit because of the simple fact that you haven't paid the debt, you have some chances to get the dollar value significantly reduced by fighting back against the fees and disputing their methods for selling the truck. Good Luck
by SmartA$$- 6 months ago