Car Loan Charge Off Question?

Question

I was told by the lender that they are charging off the the balance of the car loan.  The balance is less than 2,800.00 and is interest only. This is the balance of 6 payments I deferred thoughout the 6 year loan and the loan has matured.

They would not take any payments, they told me it had to be for the full amount.

They have told me that they are not reposessing the car because it is interest, the loan was past it maturity date and because it was small amount.

They will be turning the loan over to their charge off department.  

Once it is turned over to their charge off department, what happens then and what is the best way to handle it?  I have every intention of paying for the car, I want my title.

Thanks.

Pengy · Accepted Answer

Well here are a couple of things that will happen, one they most likely will send you the title because it is a charge off.
They will report to the credit agency's that this amount was charged off and it will remain there for 7 years from the charge off date.
They will sell the charge off to a collection agency for penny's on the dollar who will add their fees, (to the original amount) and come after you for the money

w. g · Answer

Also fined out if the are going to send you a 1099-C. for the charged off amount. That you would have to claim on you 2008 taxes as income..

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Car Loan Charge Off Question?

2 Answers