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A friend of mine owes over 25K on a motorhome that is worth no where near that amount and due to health reasons he can no longer use it. He can't sell it because the bank won't release the title without the full pay off.
If it were a home it would be a "walk away" situation.
He is worried that if he let's it go back a judge will rule he must pay the decifiet.
Any suggestions?
Check with the attorney first, but...
I'd suggest starting with mitigating his loss by turning the VEHICLE back into the loan company so that it might be sold THIS YEAR for whatever it might be worth. In that he can't sell it without them being in the middle of the transaction... let hem handle the other part as well.
They don't want to have it any more than your friend does...
But if they sell it for considerably less than the loan amount - he'll be liable for the deficiency. Same thing that happens if they repo your car for delinquent payments. Same thing that used to happen with houses until the recent crisis forced the gov't to step in and change laws (waiving taxes on any amount that is forgiven) as it applies to primary residences.
Not to say that walking away from it isn't the best thing to do - just that they may then be responsible for a significant amount of moeny. Conveniently they will usually work out a payment plan - so then your friend will get to experience the joy of writing out a monthly check for an item they no longer own.
SO if you buy something nice, use it as much as you want, then when you don't want it anymore just tell the banks-sorry, here you go.....
We have purchased things and they are no longer worth more than half of what we paid, plus all of the accessories and upkeep. We have decided to keep them. I have taken plenty losses on some things, but as long as the debt was paid off, then fine..
Is there anyone in the family interested in taking over payments??
I don't know why any idiot would buy a motor home/travel trailer to start with. Do you know how many nice hotel rooms you can rent for $25K? With clean sheets every day, fresh towels, unlimited hot water, air conditioning, microwave and fridge, and a bathtub.
Camping isn't free, around here a site is $25 a night plus they charge you for lights and cable and then charge you to dump your holding tank. Gas is $4 a gallon for a beast that gets 4-7 mph downhill with a tailwind. Then they insist on dragging another vehicle along behind them to drive when they get where they're going. All being driven by people whose previous driving history was a minivan.
Anyway, the only way to get out of the debt is to either find some other sucker to take it over (which the bank has to approve) or hand it back and then declare bankruptcy.
Can he park it in the back yard and rent it out for the payment? Have to have a sewer hookup and lights, though.
He could rent it out to someone willing to live in it. I know someone right now who is doing that very thing. He bought a big camper trailer that they really couldn't afford, so this is how he's continuing to make payments on it.
However, his property is rural, which eases the issue with sewer and water hookups.
I don't know why any idiot would buy a motor home/travel trailer to start with. Do you know how many nice hotel rooms you can rent for $25K? With clean sheets every day, fresh towels, unlimited hot water, air conditioning, microwave and fridge, and a bathtub.
It's one thing to buy such a vehicle outright and own it...it's quite another to make payments on something that depreciates rapidly.
I don't know why any idiot would buy a motor home/travel trailer to start with. Do you know how many nice hotel rooms you can rent for $25K? With clean sheets every day, fresh towels, unlimited hot water, air conditioning, microwave and fridge, and a bathtub.
Camping isn't free, around here a site is $25 a night plus they charge you for lights and cable and then charge you to dump your holding tank. Gas is $4 a gallon for a beast that gets 4-7 mph downhill with a tailwind. Then they insist on dragging another vehicle along behind them to drive when they get where they're going. All being driven by people whose previous driving history was a minivan.
No kidding. I don't get the RV'ing thing either. I don't know about other parts of the country but it seems here (So Cal) you have to have reservations for the spaces weeks, if not months, in advance. Plus insurance can't be cheap, or storage either.
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