Negotiation is common in the car business. A car’s price, options, financing, and warranty coverage are often subject to negotiation between buyer and seller. If you’ve gone through the process of buying, selling, and trading in a car, you’re familiar with these point-of-sales negotiations. What you may not realize is that in some instances the negotiation may continue after the sale and purchase is complete.
If you financed the purchase of your new or used car, you understand that you likely have an ongoing relationship with the financial arm of your car manufacturer, such as GMAC or Ford Financial Services, Inc., and possibly the dealership which sold you the car. At the heart of this relationship, the creditor’s ultimate remedy against your failure to repay your note is to foreclose against the car and resale it for at least the value of the note. Thus, your creditor’s ability to resell your car is essential to determining your creditor’s willingness to foreclose in the event of your non-payment.
How valuable is the creditor’s foreclosure remedy right now? It’s not as valuable as you might think. Recent research from the National Automobile Deals Association (NADA) reveals that the price of used cars has steadily slipped since reaching peak prices in May 2012. For buyers, that’s great news. For sellers, however, it’s discouraging. Specifically, if your creditor would experience a loss by foreclosing on your car, it may wish to keep the car in your hands and work out a settlement instead.
Given the current price of used cars, bankruptcy and the threat of bankruptcy may force your creditor to the negotiating table – and secure a much-needed financial win for you and your family. Find out more about this and many other meaningful financial and legal strategies by talking to the attorneys at the law firm of Fears Nachawati. With years of experience, we know how to protect your interests. Call us today.