Expert: David - 3/9/2009

Question
Hi David,
My husband and I were in excellent financial condition several years ago, now, like many other Americans, we are struggling. He is an independent contractor and has not had work in over a month. We bought a boat about 2 years ago and we are thinking about "returning" it and taking the hit on our credit. His credit is good but mine is average-low due to some unpaid hospital bills. The boat is in his name only but I make the monthly payment. How will this affect his/our credit?
Also, what if we do it with 2 consumer loans? We have a trailer as well. We still use the trailer so we want to keep it but if things keep going this way we will have to do everything we can to get out of some of this debt.
Any tips and or advice is highly appreciated!!

Answer
The repo will probably result in a 100 point drop in his credit.  After that you'll have to deal with the collection agencies looking to collect the difference between what the boat resells for and the loan balance you carry.

If I were you I would be very aggressive with turning your cash flow around.  Most folks that I help with Credit Repair only got into worse shape buy trying to hold on and letting themselves get into deeper debt hoping for a unlikely miracle.

www.financialscoringsolutions.com
David McArthur