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What does a voluntary surrender of a car loan mean?
What does a voluntary surrender mean? I got laid off a month ago and I can't pay for my car loan. My family told me to voluntarily surrender my car to avoid a hit to my credit.
Eric Schad · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
“A voluntary surrender of your car, also known as a voluntary repossession, is when you give the vehicle back to the lender with keys in hand.
Whether you give it back willingly or unwillingly, your credit score will fall between 50 and 150 points.
Call your lender before you give the car back; they may be willing to work out a payment plan with you.
Meanwhile, there are a couple of things you can do to help make payments on your car and avoid the credit hit:
- search for a new, temporary job
- apply for unemployment benefits
- ask a family member or friend for help
- use a credit card to help make payments
Ultimately, if you decide to surrender your car, you can use public transportation, a rideshare service, or
pay for a car rental
as needed.”View full answer
- Gregory R.
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