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Advice May Help You Steer Clear Of Car Loan Trouble

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The Tampa Tribune

Published: December 29, 2008

Some advice from consumer lawyers on keeping your car loan in balance and avoiding a deficiency judgment in court:

Pick the shortest loan payment plan you can afford. Some people are taking out six-year loans. Equity builds so slowly this way you may still owe thousands years into the loan.

Sell the car yourself. If you lose your car to repossession, chances are the finance company will sell it at auction, and often for far less than you still owe. Consider selling the car yourself; you may get more.

Bankruptcy is an option in some cases. There are good reasons to avoid bankruptcy, but if you choose this route, remember: Deficiency judgments are considered unsecured debt and can be dismissed by a judge.

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