Voluntary Repossession

Things You Should Know Before Considering Voluntary Repossession of a Vehicle

With the state of the economy it isn’t surprising that many people are facing repossessions or deciding upon voluntary repossession of their vehicles. Repossession occurs when you are no longer making payments on your loan to the creditor that holds the title to your property. It’s a very unpleasant experience for everyone involved and even though the vehicle is no longer in your possession, you still have to pay off the balance. One way to alleviate some of this cost is to do a voluntary repossession instead.

What Is It?

Voluntary repossessions are repossessions that the consumer instigates. Instead of waiting for the creditor to come after the person, they alert the creditor and skip several unpleasant steps, even managing to save money in the process. Do not be mistaken in thinking that doing it this way will save your credit; it is still repossession, and still has all the negative effects.

How to Determine if a Voluntary Repossession Is for You

Knowing whether or not to voluntarily hand over your vehicle can be quite confusing. If you are falling behind in your payments due to financial hardships, illness, or loss of job you are likely feeling a great deal of stress and anxiety in regards to prioritizing your bills.

Before contacting your creditor, you should speak to a debt relief provider or other company that may be able to act on your behalf to lower payments on your loans. Many of these companies and providers are available for a free consultation, and certain people may qualify for free debt relief representation.

Beginning the Process

If you’ve decided that voluntary repossession is the proper course of action for you, the first step you need to take is contacting the lender via phone. When you get a hold of your phone rep, inform them that you can no longer make the payments on your vehicle and need to arrange for a repo.

It’s very likely that the company you are in debt to will try to talk you out of this or at the very least act like you are causing a problem for them. In some cases, however, the company may offer to work with you on your payments. If they happen to be flexible enough, you may be able to stop the process right here and actually keep your loan and maintain your credit score.

How it Works

Once you’ve made the call and informed the company that you would like to hand over the vehicle, they will arrange for an appropriate spot to turn over the vehicle. In addition to this, they will also give you any other instructions you will need to complete on your end, particularly paperwork related.

Following this, your car will most likely be sold at auction. The price that the company gets for the car will then be deducted from the amount that you still owe on your loan. You are responsible for this remaining balance, so do not assume that turning over the car makes you free and clear of financial responsibilities.



There are many benefits to doing a voluntary repo. Taking the initiative can save you several hundred dollars in some cases because the company will not have to hire an agent to come get the car, and you will likely not be held liable for storage fees.

Your credit can also be saved a bit of drama. While you will still have a default on your rating, you should be able to have your creditors cease reporting missed payments. Since you are saving them money by stopping them from having to hire an agent, many companies should have no problem doing this for you.

Stress reduction is also a big benefit. You will not have creditors calling your house all hours of the day and night, so you can stop screening your calls. You don’t have to worry about agents and repo men showing up at your house. Even the act of taking the initiative can give you a sense of empowerment and not leave you feeling like you’re in a hopeless situation.