I am one of those attorneys that has been very disappointed by the 722 redemption process. Most people that go through Chapter 7 get offers to finance the purchase of another vehicle immediately after they receive their discharge. It is the waiting for the discharge that is so scary. The other recommendation I have is for my debtor's to deal in cash when making purchases, which means shopping for a private party vehicle. Believe it or not, you can do okay for $2,000 or less and have a vehicle paid off. Hope this perspective helps!
I agree with atty Bunce. You might be better off just waiting until after your discharge, if possible, then go to a regular dealer. I have surveyed many of the local dealers in my area (Simi Valley) and they have all said a loan on a new or used car after discharge is no problem. They just want to see a copy of the discharge notice to confirm the BK is over, then you're O.K. for financing. The interest rate may be a little higher than without the BK, but at least you should be able to get the financing. So, check with other dealers near you to see if they will do the same, without having to do the 722 financing.
I agree with the other responses. Redemption is the process whereby you pay the current lender the current fair market value (instead of what you owe them) and keep the car. It sounds like you don't really want to keep the car, and the 722 redemption funding companies charge 24% or more to finance another.
Yes, surrender the car, and get something else after you receive your discharge.