Regaining Financial Control over Your Car Payment Installments
Are your car payment installments totally out of your control? Are you at risk of losing your car as you are unable to meet repayment obligations? Good times do not last forever and it is just possible that you are temporarily out of a job after having committed to buy a great but costly car and are stressed out by the repayment of dues? Or have you been over-burdened with a car loan and are unable to meet repayment deadlines? There may be hundreds of reasons which prevent you from meeting your car loan repayment obligations and you may be stressed out about your car being re-possessed.
It doesn’t matter why car payments became unaffordable, it is important to now know what you can do next as the drama unfolds. Moving really fast can very well help avoid missing installment payments or when having your vehicle repossessed. Ideally, it should be possible to reprogram your car costs to fit better into your stressed out budget or finances. Here’s what you could do to take back control of your car payments and installments.
1. Discuss with your lender before you decide to miss a single payment
If you are about to miss paying an installment, do get in touch with your lender immediately as they might lend you an ear and be more than willing to listen to your issues and cut you some slack, one odd time. This is possible if there is a temporary fall in incomes and finances. Communication is extremely critical and that is why you must talk to your lender, and it’s likely that they would want to help you out, more so if you happen to be a long time, regular and loyal customer. They would not want to take the car back.
Try to explain what’s stopping you from making further payments, might make the lender more sympathetic and he/she could possibly allow ‘forbearance’, which is a period of time, wherein you can make reduced payments or even pause/skip a payment which is due soon. Or, the lender could even stretch the number of months you would make these payments over. This would ultimately reduce the monthly payments, but in the future you’ll mostly have to pay more as interest. Which is still better than causing damage to you credit score, which would reduce substantially following any repossession.
2. Have your numbers checked
Other possible answers would depend on your individual situation, which would require you to draw up a few numbers;
The value of your car. You can figure out how much your car is worth by referring to a pricing chart, which would be available, if you search online.
How much money you owe. The lender could calculate and intimate you about your payoff amount.
Your term loans and interest rate. By asking your lender or simply by checking your statement of loan, you can find out your rate of interest and how many more months you have to pay it all off.
If you come to owe less than your car’s value, you now have positive equity, when you have many more options such as refinancing or downsizing. But if you owe more than you car’s worth, you face negative equity, and this would make it rather difficult to escape the debt trap
3. Make a repayment plan
Make an effort to find solutions which are long-term and realistic in terms of how much of it you can really afford. If you find positive equity, your options are:
Initiate enquiries and seek out the lowest interest rates after getting in touch with online lenders, credit unions and banks to refinance your loan. Make use of an auto refinance calculator to make estimation about what you could be saving with lower interest rates or a longer payment term.
May be you could consider giving up your car or selling it directly to some dealer to escape from the high car installment payments. Using the equity of your vehicle as a sort of down payment could land you a more price-friendly car. You could also consider buying a used car with a cash payment so you do not have to make monthly payments.
If you face negative equity, you could:
Catch up on payments and downsize
By this we mean using cash or securing a small loan to pay for the difference in the value of your car and what you are still owing. You may choose to sell the car or exchange it for a more budget friendly ride. Also check for the possibility of trading in a vehicle with negative equity, although, you will still have to cover the difference.
Find savings from other sources
By freeing up some leverage from your car’s budget, shopping for cheaper car insurance could be useful. This cannot lower the car installment payments, but the savings could be diverted towards repaying your loan.
Speak to your lender
Should you have no options regarding the debt, but still need to keep your car, the lender may discuss other options with you, to help you out.
More inLoans & Mortgages
The Most Affordable Time to Visit Luxury Destinations, from The Caribbean to Hawaii
Our daily environment can become too toxic at particular times. This then would call for a vacation to unwind and reset...June 16, 2021
A Professional Loan Broker is the Lifeline that Your Small Business Needs
Why get help To navigate the murky waters of getting funding for your business, you need some expert advice from someone...June 16, 2021
Learning from the Stars: Celebrities Fess Up to the Worst Money Mistakes They Ever Made – Part II
It is a known fact that celebs lead a very lavish life, spend exorbitantly and one would expect them to be...June 16, 2021
These Bigwigs Took a Loan and Turned it into a Million-dollar Business
Millionaires certainly enjoy the good life and can afford fancy mansions and cars but most didn’t start out rich. Like many...June 15, 2021
The Most Expensive Baby Photos Bought by Magazines
It’s true that babies are great blessing to a family. They tie families together and make each and every house feel...June 15, 2021
Highlights of Coachella’s Weekend One
There is a new holiday in town and it is being celebrated by the young and fashionable party goers. It is...June 15, 2021
Insider Scoop: What It’s Really Like to Work with Celebrity Clients
Many decades of assisting celebrities and professional athletes has enabled Jordan Waxman to carve out a successful sports and entertainment group...June 14, 2021
Forget Networking, Social Media is Being Used to Sell Real Estate Now
Facebook Imagine showing detailed listing information to every newlywed couple in their 30’s within a 20 mile radius. Although...June 14, 2021
These Huge Stars Have Extra-huge Mortgages that We Can’t even Dream about
We gaze spell-bound at amazing mega-mansions and estates on the internet and follow the real estate ventures of celebs and ultra-rich...June 14, 2021