What to Do if You Fall Behind on Auto Loan Payments
If you’ve lost your job or faced recent unexpected expenses, you may be worried that you’re going to fall behind on your auto loan payments. Ideally, you should take action before you miss a payment. As soon as you know that you can’t make an upcoming payment, get in touch with your auto loan lender to work out a solution.
Request a loan forbearance agreement.
If you have a temporary financial problem, a loan forbearance agreement can give you the wiggle room you need. Your lender may agree to let you skip a couple of payments. Those payments would be added to the end of your loan, so you’ll still end up making them eventually. A similar agreement is to make small payments for a few months. However, if you think your financial problem will last longer than the forbearance period, it may be best to explore other options.
Refinance your auto loan.
If your financial problem is a long-term one, and you have strong credit, then refinancing the auto loan may be your best option. Refinancing the loan may give you a lower interest rate or a longer life of the loan. Either modification would result in smaller payments. Of course, your original lender might not be willing to refinance. Consider going to a credit union instead. Credit unions are known for working with their members to develop customized financial solutions.
Sell your vehicle.
While it might not be the most ideal option, selling your vehicle may be the only feasible path forward if you can’t refinance or get a forbearance agreement. Of course, selling your vehicle will only improve your situation if the sale price is at least equal to the amount you have left on the loan. Another option may be to sell your car to someone you know who is willing to take over the loan or lease.
GCS Credit Union offers auto loans in O’Fallon at the highly competitive rates you need and the customized terms you deserve. Come in and speak with a member representative today, and we’ll work to structure your auto loan to suit your needs. Call (618) 797-7993.