auto

Giving back car will damage your credit

Dear Terry,
We owe $17,379.40 on our auto loan. We have already purchased a smaller vehicle that gets better gas mileage and has a slightly lower monthly payment. You said to give back the original car to the dealer or the finance company only as a last resort. Help.
-- Gregory Merkel

Dear Gregory,
If you simply turn the old vehicle back to the finance company without paying off the balance, it will damage your credit score the same as a repossession. Try selling the old vehicle. Since I assume you owe more than it's worth, try to find the cash to cover the shortfall.


Here are this week's reader questions:
Certified cars offer value, reassurance
Can I cancel my car deal?
Do car payments help rebuild credit?
Will returning my car have repercussions?
advertisement

Show Bankrate's community sharing policy
          Connect with us
advertisement
CAR & MONEY NEWSLETTER

Get cost-cutting tips for buying, selling and maintaining your wheels. Delivered monthly.

advertisement
Partner Center
advertisement

Blog

Tara Baukus Mello

Tesla taps owners to be sales force

Tesla is tapping its current owners to act as a sales force by offering them cash and other incentives, including a free Model X, when they refer friends who buy a car.  ... Read more


Connect with us