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Old 02-18-2014, 03:56 PM
 
24 posts, read 52,810 times
Reputation: 32

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We took out the loan 4 yrs ago for $1500 & now, 4 yrs later, we've paid about $9000 in interest!! Is there a way we can offer a settlement? The car is only worth about $700 due to dings that's happened over the last couple of years. Should we stop making payments for a short period (like 30 to 90 days) before offering a settlement or just go ahead & offer one without stopping payments? All of our payments have been up to date with the exception of a couple times each year where we've had to push them for a week or two. Should we offer the $700 the car is worth or higher? Right now it's saying we owe $1690 since we've always just paid interest because that's all we could afford.

We live in Oneonta, AL & we use Easy Money
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Old 02-18-2014, 04:10 PM
 
Location: Keosauqua, Iowa
9,611 posts, read 21,135,113 times
Reputation: 13662
I'm skeptical as to whether this is a real post, but just in case it is.......

You can't offer a settlement, the lender would have to do that. But you can ask for one.

Personally, I'd offer $700 or the car, whichever they prefer. Tell them take it or leave it and be prepared to walk away. Just make sure you don't keep any personal property in the car because they will eventually come get the car. You will be on the hook for the difference between what they sell the car for and what you owe, but if you're so broke that you haven't been able to come up with an extra dime over the course of four years to put toward the balance then you probably don't have anything for them to take if they do get a judgement.

Whatever you do, if they do agree to a settlement make sure you get it in writing before you give them a cent.

One more thing: I don't think you use Easy Money. It sounds more like Easy Money uses you.
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Old 02-18-2014, 04:16 PM
 
793 posts, read 1,412,257 times
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From a matter of ethics, you owe $1690. It doesn't matter if the property is worth $1 or $10,000.

That said, what is your credit worth to you?

Here's a good article: The Dangers of Debt Settlement
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Old 02-18-2014, 05:14 PM
 
63 posts, read 123,707 times
Reputation: 50
Have you had full coverage insurance on the vehicle? I have seen force placed insurance drive the balance of a vehicle to over 3X the original balance of the loan. I would ask more questions on why it has been so much. Sit down with someone and ask calmly for account statement so that you can look at it while you discuss the loan.
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Old 02-18-2014, 05:43 PM
 
Location: Prosper
6,255 posts, read 16,972,344 times
Reputation: 9501
Holy...

You need to get out from under that loan, NOW. It doesn't matter if it damages your credit, because by your income level, I'd say it's not worth worrying about if you've only been able to pay interest on the car all this time.

You could even file for bankruptcy and you are allowed to keep one car and your primary residence, that debt will be written off. Can probably find a bankruptcy lawyer to do a simple case like this for $3-500, or possibly even an advocate can do it for free for you, but one will be hard to find. (People doing pro-bono work typically don't have too much free time to take on cases.)
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Old 02-18-2014, 05:57 PM
 
24 posts, read 52,810 times
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@duster: this is a real post. And after reading these responses I guess our best bet would be to keep paying the monthly payments but also try to find some money to set aside each paycheck (cutting whatever we can) and pay off the $1690. Thanks guys for answering!
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Old 02-18-2014, 06:10 PM
 
5,681 posts, read 5,058,584 times
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In the event this is a real post, I would ask the following questions:

- Why did you let a title lease balloon up to $9K of interest alone and, indeed, why did you take out that lease in the first place? It won't help the current issue but perhaps (unless it was a life-and-death emergency that forced you to do so) it might help you re-evaluate your future decisions.
- How good your credit is (my guess is: not very) and how much it matters to you (my guess is: not a whole lot).
- Can you do without a car in the event it gets re-possessed?

I could draw a whole host of inferences from your situation but there isn't a point in doing so. You've got an issue on your hands that you need to get a grip on. Sit down with a financial advisor (your local community center should have someone with a 13-grade education who understands single and compound interest) and figure out what is going on and how you can dig out of this mess. From a purely ethical standpoint 2tall is absolutely correct: you owe what you owe. Nobody here is going to give you a way to beat that as it's not only unethical, it's illegal. If you want to try to settle with Easy Money, sit down with one of their loan sharks and see what solution you can come to, but don't be surprised if they refuse, come to re-possess the car and hit you with collections notices in the process.
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Old 02-18-2014, 06:11 PM
 
5,681 posts, read 5,058,584 times
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Quote:
Originally Posted by luvfelicia View Post
@duster: this is a real post. And after reading these responses I guess our best bet would be to keep paying the monthly payments but also try to find some money to set aside each paycheck (cutting whatever we can) and pay off the $1690. Thanks guys for answering!
Your best bet would be to sit down with a financial planner and re-evaluate your entire budget - not just the car payments.
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Old 02-18-2014, 09:31 PM
 
17,375 posts, read 14,901,467 times
Reputation: 22604
You'd be better off getting a credit card with a sky-high interest rate of 20% and transferring the balance to it.

Paying $45 a month would have it paid off in 5 years, and you'd 'only' pay $1000 in interest.

Something about the math doesn't add up here. To have paid $9000 in interest in 4 years.. that's somewhere around a 400% APR by my math. That's why everyone is asking whether this is legit or not.. Because.. If it is.. Highlanderfil is dead on right.. You need someone to sit down and do some math with you.. Or just set some money on fire in front of you to make the point.

You didn't happen to get this loan through a Native American owned company, did you? That's been the latest scam.. If it's based on a reservation, they can avoid some of the predatory lending laws. Although, they seem to be getting caught on them now.. Western Sky, which I saw advertised on ESPN a few times, their site is now offline.. But, they advertised APR rates of up to 255% But.. At least they were honest about it. Not like they were tricking people.

I'd certainly say this is a predatory loan that you're in.. But.. is it an illegal predatory loan? Pouring hot wax on someones face is illegal, unless they're asking and paying you to do it..
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Old 02-18-2014, 09:58 PM
 
Location: Prosper
6,255 posts, read 16,972,344 times
Reputation: 9501
Quote:
Originally Posted by Labonte18 View Post

Something about the math doesn't add up here. To have paid $9000 in interest in 4 years.. that's somewhere around a 400% APR by my math. That's why everyone is asking whether this is legit or not.. Because.. If it is.. Highlanderfil is dead on right.. You need someone to sit down and do some math with you.. Or just set some money on fire in front of you to make the point.
Agreed. Paying $9k over 4 years (48 months) works out to $187.50 for a monthly payment which they claim is all interest. On an annual basis, that's $2250, or about 150% APR.
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