Stopping car payments Driving for Dollars by Terry Jackson • Bankrate.com

Dear Terry,
What happens if I don't pay my car payments and they repossess it? What is next? End of movie? I will not file for bankruptcy; just not pay my car payments. I know it is not fair, but we need to make a decision.
-- David

Dear David,
A lot of bad things will happen.

First, your credit rating will be damaged for at least the next seven years, affecting your ability to get any sort of loan and perhaps even affect your ability to get insurance and perhaps get a job, since some insurers and employers run credit checks. Also, a collection company will pursue you for the difference between what you owe on the vehicle and what the lender was able to sell it for wholesale. Without filing bankruptcy, you could face a court lien on other property, have your wages garnished or your bank account seized.

Before you just throw up your hands, please call the lender and see if something can be worked out. Any agreement would be better than simply walking away from the vehicle.

This week

• Driving for Dollars: Few can afford new car prices • How many miles should a set of tires last? • What happens if I just stop making my car payments? • Is the maintenance schedule from the dealer right?

If you have a question for Terry, e-mail him at Driving for Dollars.