Topic: What happens if Life 'Happens' & you can't pay?

[SeasideLass]

Hi all, my friend who totalled her Cavalier in Jan which I posted about, got 1300.00 for it from insurance. Her boss encouraged her to buy/lease a new car as the salesman lives next door.She ended up leasing a 2014 Yaris. That was Jan. 26th. March 15, same woman lays-off my friend.

This lease is causing severe hardship for my now unemployed friend, and I'd like to strangle that boss A reasonable replacement vehicle could have been had for 4-5,000, not 14,000 or so.

My question to you savvy people is what happens when somebody can no longer afford to lease the car? The car is repossessed? What about $$ already invested. It is a 5 year lease.

[aquadorhj]

leasebusters. 

your friend's boss sure was cruel though.     and your friend was stupid to not account for this situation.

once you miss few payments, the car is repo'ed.  whatever payments made so far is obviously a payment made to use the car.. she used it..   it will probably go on your friend's credit record that she is a delinquent.  will probably make the next credit purchase difficult.

[SeasideLass]

leasebusters. 

your friend's boss sure was cruel though.     and your friend was stupid to not account for this situation.

once you miss few payments, the car is repo'ed.  whatever payments made so far is obviously a payment made to use the car.. she used it..   it will probably go on your friend's credit record that she is a delinquent.  will probably make the next credit purchase difficult.

I was afraid it would be like that, but had not factored in the credit record. I would think that a decent person would have gone to the neighbour salesman and told him that the business was closing. Maybe he could have helped? That's why my friend went there in the first place w/the ex-boss and neighbour "because he would give her a great deal". Cruel and stupid was her boss as she knew the business wasn't doing as expected.

Thanks for reply.

[ArticSteve]

Well this is not a good situation.  How much money was "already invested"?  I assume not much.

Lease busters probably won't work in her case.  PPL looking to take 56 months of payments on a Yaris will be expecting a huge incentive which I doubt your friend has or is willing to provide.

Essentially she contacts Toyota Financial, returns the vehicle and they sue her for X amount of loss and her credit is destroyed.

Obviously she needs a job.  What's that looking like?

[KKullar]

^ I agree. Try contacting Toyota Financial Services. Explain what the situation is and what the penalty would be. Once she has some figures, she can try listing the vehicle privately for sale and doing a lease buyout once she has a buyer. If she wants to break the contract she will likely have to pay out of pocket in some way, either by dropping off the car to TCI or by buying the vehicle out and selling it private party and eating the delta on the transaction.

With that being said, I would encourage you and her not to focus on minimizing expenses (a time-consuming task) but rather on finding employment again ASAP. Help her with her resume, interview skills etc. In the long-run it's best to focus on how to re-build an income stream rather than cutting back expenses.

  Kev

[Northernridge]

My two cents is to encourage her to look past the next month or three in decision making. Her situation might feel/seem a little desperate right now but she will most certainly find a job over time and her efforts should go to scraping by for now and getting employed. I'm sure every (legal) option for getting rid of the car will end in tears. Once she's re-employed I bet she'll be happy to have years of trouble free, low cost driving with the Yaris. She should not make decisions as though she's going to be unemployed forever.

If she was my friend, I would give her this council. If I really liked her I'd help her find a job. If she wasn't a deadbeat, I might even cover her lease for a few months (what's a few hundred bucks?). Then I'd give her a gentle but firm talk on decision making and looking after herself properly.

[mmret]

My two cents is to encourage her to look past the next month or three in decision making. Her situation might feel/seem a little desperate right now but she will most certainly find a job over time and her efforts should go to scraping by for now and getting employed. I'm sure every (legal) option for getting rid of the car will end in tears. Once she's re-employed I bet she'll be happy to have years of trouble free, low cost driving with the Yaris. She should not make decisions as though she's going to be unemployed forever.

If she was my friend, I would give her this council. If I really liked her I'd help her find a job. If she wasn't a deadbeat, I might even cover her lease for a few months (what's a few hundred bucks?). Then I'd give her a gentle but firm talk on decision making and looking after herself properly.

This is good advice. The problem right now isn't the car - its finding a job. The car is a sideshow that will fall into place once a job is found.

Not always easy, no, but you have to focus on the bigger topic here.

[blotter]

Aside from what Northernridge has said,

being she was layed off, I'm assuming unemployment should start rolling in at some point?
aside from the obvious of looking for a job, it's time to do some serious budget crunching. 
She's still going to need a car and it doesn't get much cheaper than a Yaris.

There's so much at stake in terms of just breaking the lease and handing it back.

I can't see anything on Toyota's website right now, but not long ago they advertised lease / payment extensions.   It's basically allowing people to skip a month's payment.   If she has any other loans or a mortgage, she should call her Financial Institution ASAP to do the same.  Most allow "skip a payment" options.    This could be used to free up cash and push aside loan obligations without getting her credit hit.    These are just small temp measure but they could be just enough to help get her by until she finds a job.   

[Northernridge]

One other oddball thought...both of my kids are looking for cheap transportation to drive to work for the summer and then won't need a car in the fall going back to school. Again, if she were my friend, I might be able to take the car off her hands for a few months, cover the expenses and just give it back when she's on her feet. Of course your friend would need to tap into a network to find a solution like this.

[SeasideLass]

Thank you so much for your advice and thoughts.

It took her almost to the end of her EI period to find the job she was just laid-off from. The problem is that she is an "older" worker in a very hiigh-tech world. As well she has to move at the end of May and I have loaned the damage deposit to her.

She got the Yaris Jan.18th I think, & was laid off March 15. It is a 5 year lease. At the moment her son is helping best he can. He is quite fragile after having a liver transplant @ 18mths and can get very ill very fast. Was hospitalized (twice) when he got chicken pox. I was against a new vehicle from the start and thought she could get a car in good working order for abt 5,000.

When she was given notice of the shop closing March 1, I encouraged her to go to the salesman (boss's neighbour) and see what could be done. There's much more about leasing than I thought, so thanks for help. Her EI has just kicked in, she gets 23 weeks. I am helping her w/her search for work, resumes and suggestions as I did when her 10-year employment ended. At least she got severance then.

It is a sad situation

[KKullar]

Definitely a tough situation. With that being said, kudos to you for stepping up to the plate and helping her through.

  Kev

[ArticSteve]

As well she has to move at the end of May and I have loaned the damage deposit to her.


Oh boy.  That bad eh. Obviously she can no longer afford a car or insurance or gas.

Inform Toyota Financial that the show is over.  Include a letter stating assets and liabilities.  If they are as bad as stated they might just write the lease off without legal action which will result in a Judgement registered against her which is worse than a R9.

[SeasideLass]

As well she has to move at the end of May and I have loaned the damage deposit to her.


Oh boy.  That bad eh. Obviously she can no longer afford a car or insurance or gas.

Inform Toyota Financial that the show is over.  Include a letter stating assets and liabilities.  If they are as bad as stated they might just write the lease off without legal action which will result in a Judgement registered against her which is worse than a R9.

She had to move, and she knew that. She lives in subsidized housing, and needed a 2-bed vs a 3-bed. However, downsizing doesn't help her financially, as it is 30% whatever your income......so goes up and down accordingly. I don't know abt insurance. Think a job finding program she joined helps w/gas and Yaris is very good w/gas. Just have to cross our fingers and hope to heaven her son doesn't become ill. For the life of me I can't think why life keeps on and on throwing all this misery at her.

As an aside, I said a heartfelt and teary goodbye today to my dog Rolo, who was the best friend I ever had. We had a great life together for about 10+ years until his hips became too bad to walk much. And stairs complicated this no end.

[blur911]

As an aside, I said a heartfelt and teary goodbye today to my dog Rolo, who was the best friend I ever had. We had a great life together for about 10+ years until his hips became too bad to walk much. And stairs complicated this no end.

So sorry to hear this, hang in there.

[SeasideLass]

Thank you - I'm in some sort of shock I think. I will miss my joyful boy.

[sailor723]

I am SO sorry to hear that. I've only had to make that call once and it was awful.

 Was he the cutie in your avatar?

[SeasideLass]

I am SO sorry to hear that. I've only had to make that call once and it was awful.

 Was he the cutie in your avatar?

Yes, that's my boy. Despite my heartache, I know I did the right thing by him - and I treasured the many memories of our great life together. I'll stop crying sometime.......

[sailor723]

I am SO sorry to hear that. I've only had to make that call once and it was awful.

 Was he the cutie in your avatar?

Yes, that's my boy. Despite my heartache, I know I did the right thing by him - and I treasured the many memories of our great life together. I'll stop crying sometime.......

We went through the same thing with our Golden Retriever. His hips went as well and in retrospect we probably put the decision off a month or two longer than we should have. I was carrying him upstairs at bedtime at the end. I know what you mean about the crying. I had to pull over about 100yards down the road from the Vet because I couldn't see well enough to drive.

Keep your chin up...you will feel better in time.

[bridgecity]

Thank you - I'm in some sort of shock I think. I will miss my joyful boy.

Sorry to hear. 

Our yellow lab is reaching old age (she's 10) and I see signs of her hips/legs deteriorating.  It going to be a rough period when it's time.

[dr_spock]

As an aside, I said a heartfelt and teary goodbye today to my dog Rolo, who was the best friend I ever had. We had a great life together for about 10+ years until his hips became too bad to walk much. And stairs complicated this no end.

So sorry to hear.