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legalgems
legalgems, Lawyer
Category: Legal
Satisfied Customers: 10484
Experience:  Just Answer consultant at Self employed
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I can't afford my car so I called the lender to surrender

Customer Question

I can't afford my car so I called the lender to surrender the car. I know it will go to collection but can they put a lean on my house which own outright?
JA: What state is this in? And how old is the car?
Customer: in California 2011 GMC Terrain
JA: Has anything been filed or reported?
Customer: no not yet I am only a few days late on my payment
JA: Anything else you want the lawyer to know before I connect you?
Customer: no
Submitted: 5 months ago.
Category: Legal
Expert:  legalgems replied 5 months ago.

Hello! I will be reviewing your question and posting a response momentarily; if you have any follow up questions please respond here. Thanks!

Expert:  legalgems replied 5 months ago.

I'm sorry to hear that your car is so costly.

If a buyer surrenders their car, the lender will sell it at auction; normally the lender will receive less than the loan amount, so that they will then sue for a deficiency judgment- to get a judgment for:

1. legal fees

2. the cost of the auction

3. any unpaid loan balance.

Once they have a judgment (small claims if under $10,000) they can then fille an abstract of judgment in the county where property is located, and that will put a lien on any real estate.

As such it is usually preferred to sell the car, as a higher price is usually received, and then pay off as much of the loan as possible. This also avoids the imposition of fees #1 and #2 above.

Further questions? Please post here to continue the chat.

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Information provided is for educational purposes only. Consultation with a personal attorney is always recommended so your particular facts may be considered. Thank you and take care.

Customer: replied 5 months ago.
can I quit claim the property now?
Customer: replied 5 months ago.
can I quit the property now?
Expert:  legalgems replied 5 months ago.

You mean sign the title to the car over to the lender?

Customer: replied 5 months ago.
no, quit claim my house to a friend so they could not put a lean on it if it is not in my name anymore
Expert:  legalgems replied 5 months ago.

Unfortunately transactions that are done with the sole intent to defraud a creditor can be "voided" or undone by the court so quitclaiming is not effective in such instances.

Expert:  legalgems replied 5 months ago.

Hello again; just checking in to see how things worked out;
if you have further questions please don't hesitate to reach out to me here on Just Answerand I will do my best to get you the requested information.
Thanks!

The above information is for educational purposes only. A consultation with a private attorney is recommended so they can apply the law to your specific facts, and suggest the best course of action. An attorney can be located here:
http://www.americanbar.org/groups/public_education/public-information/how-do-i-find-a-lawyer-.html