loans that are secure
Date: Thu, 08/06/2009 - 14:11
I don't think so. I looked at several debt consolidation plans,
I don't think so. I looked at several debt consolidation plans, and they only wanted to know about unsecured debt. If you fall behind on a car note, they have the option of repossessing the vehicle and requiring you to pay the deficiency balance. There is really nothing to be gained by the finance company to work with a debt consolidation company.
There is nothing that precludes you from trying. Although the c
There is nothing that precludes you from trying. Although the company that's helping you consolidate would be smart to advise you not to. Generally secured creditors will not agree to any sort of debt consolidation plan.
That is because the collateral is rapidly depreciating in value. When they approve financing on the vehicle, they generally calculate your payments so that you pay back the loan quicker than the vehicle depreciates. (hence why you'll never see 10-year financing on a car loan....) That way, at any given point if you stop paying, they can repossess it and the car will still be worth more than you owe on the loan. (At least in theory; in practice, it doesn't always pan out that way.)
When your debt consolidation plan proposes to pay them $50 per month, they will most likely refuse because the car will start to lose value quicker than you are paying back the loan.
