If you fall behind on your car payments, the lender can confiscate your vehicle. You might be one month behind on your payments, or you might have skipped several loan payments. Fortunately, there are several ways you can keep your vehicle and resolve the late payments. Every option will not be ideal for your situation, so you should research your options before you choose a solution.
Make a Loan Payment
- 1. Make a Payment
- The auto loan could be in default one day after your missed payment. Some loans do not go into default status until 30 days after the missed payment. Sometimes, the loan will not go into default status until the creditor sends you a written notice. If you have not defaulted on the loan, you can make a payment. You will have to pay the past due balance.
- 2. Pay the Late Fees
- When you make the payment, the amount should also cover the late fees. If you do not pay the late fees, the creditor can put your loan in default status. If you have more than one car, you may be eligible for auto title loans. You may qualify if your second car does not have any liens. The loan might be enough to cover your late payments.
- 3. Reinstate the Loan
- You can also reinstate the loan. If your loan is in default, you can give the creditor a large payment. The payment should cover all of the previous loan payments and the late fees. Some states do not allow reinstatements. If your state does not allow reinstatements, you should ask the creditor if reinstatements are in the loan contract.
Get the Car Back
- 1. Redeem the Car
- If you cannot prevent the car from being repossessed, you can redeem the car. You might be able to get the car back if you can pay the past due loan payments, late fees and repossession fees. You should consider redeeming the car if you only owe a few more loan payments. If you want to redeem your car, you need to take action immediately. When your car is sold, you cannot redeem your car.
- 2. Negotiate a Better Deal
- You might be able to negotiate a deal with the creditor. The creditor might not get much money for the vehicle at a public auction. If you can sell the car for a higher price, the creditor might let you sell the car. The creditor will save money on storage and advertising fees.
- 3. Refinance the Car Loan
- Some creditors will let you refinance the loan for a longer term. You should use this option if the original loan payments are more expensive than the new loan payments. This is a great option for newer vehicles.
- 4.File for Bankruptcy
- If you file for bankruptcy,the creditor cannot repossess your vehicle. You should consider this option if the creditor threatens to garnish your wages.