HELP... what is an auto loan Equity Swap???

[knowthescore]

I need some advice.... purchased a vehicle a month ago...... car has been at dealership for 17 days, dealership called me today to tell me that the car is not driveable. They are willing to do an "Equity Swap" with my lender. What does this mean???? Thanks in advance for any help!

[InDebtInDC]

It sounds like the dealer wants to seize the car as collateral and have you make the car payments directly to the dealer. The dealer will in turn pay the lender an amount they both agree upon.

I may be wrong though, as I'm not sure what the details are, but it sounds fishy to me.

If I were you I'd try to fix it. What's wrong with it?

Good luck.

[knowthescore]

Equity Swap

The car died on me... they said it had 8 "OBD CODES, they fixed all codes but "Multiple Misfire" and the car still wont run. Dealership had a KIA specailist come and work on car and by the time they were done they still had "Multiple Misfire" & "Multiple o2 Bank Sensor Failure" This is a 2006 with 15K on it.

[InDebtInDC]

The car died on me... they said it had 8 "OBD CODES, they fixed all codes but "Multiple Misfire" and the car still wont run. Dealership had a KIA specailist come and work on car and by the time they were done they still had "Multiple Misfire" & "Multiple o2 Bank Sensor Failure" This is a 2006 with 15K on it.

Okay, first, when a car stores a code in the On-Board Diagnostic (OBD) system, it means that there is something wrong with the drivetrain and one or more of the sensors is detecting the error.

You can't "fix a code". It's like you can't diagnose the symptoms; you can only treat the symptom. You have to diagnose the disease.

The code will tell you what is being affected; it won't tell you what's causing the problem. You have to test the components related to the affected components.

Can you give me a little more details than "it just won't run"? Will it start? Will it start but not idle? Will it idle but not drive?

The Multiple Misfire and Multiple O2 Bank Sensor Failure sounds to me like the engine is not running correctly, and it's causing the car to detect the misfires and bad emissions.


It sounds like the dealer want to buy the car back from you. Honestly, if I were you I'd try to find a way to get rid of that car.

Find yourself a late 90s or early 00s Toyota Corolla or Geo Prizm and you'll have much better luck for about the same money.

[simpleyme]

I really know nothing but are they trying to take the car back because its a lemon?
so they would need to undo the deal,or trade you cars or something to make everything better since the car cannot be fixed?

[LuckyRobin]

This is what I found. Hope it is helpful. Circumstances may very slightly and this is based on CA state laws.

If you financed or leased your vehicle, you are entitled to get back your down payment (or lease inception fee), government fees, trade-in equity, license fees and all the monthly payments you have made up to the date of settlement. You may also be entitled to towing reimbursement, as well as rental car expenses you personally paid during your warranty repair visits. The manufacturer pays off the existing loan (or lease), you turn the vehicle back in to the car dealership, and you get your Lemon Law refund check. This is known as a vehicle repurchase. In certain circumstances you may also elect to take a replacement vehicle in lieu of a repurchase. This is known as an exchange of collateral. Your loan remains the same, and you simply “swap” your present vehicle for a new one with the same equipment. Leased vehicles are treated in the same way.

[QuadSquadMom]

Usually an equity swap on a car happens when the car is deemed dead and they are offering you the value of it towards another car.

My sister had a major wreck that totaled her car at a time when she did not have the funds to replace it for more than the insurance would pay.

Like the info posted by LuckyRobin, "Your loan remains the same, and you simply “swap” your present vehicle for a new one with the same equipment." In my sister's case it was another used car, but of the same value and she continued on the same auto loan. The insurance and the dealership worked with her credit union to make the replacement on the loan/lien holder paperwork.

Similar thing happened to my Goddaughter. She bought a used car on a credit union loan for $6,000. The car never ran right, was constantly in the shop, and the dealer finally deemed it unrepairable. After much hassle with the dealer, they finally agree to a collateral swap for the same value. They swapped for another car & worked out the paperwork with the credit union with no changes to the loan agreement.

I hope that helps.

[project15]

2006 with 15k? Doesn't warranty cover this or was it your fault that the car won't run (driven through water lately?)

[DavidSB1950]

Gawd...I miss the days when all a car needed was points, plugs and a condenser and it would run for another 2 years