If you’re on the verge of missing an auto loan payment, you may be worried about repossession. Your car could be repossessed even if you only miss one payment, and this is something that most people would rather avoid. But, it may not have to come to that. You can help yourself avoid a repo in Seattle with these tips.
Avoiding Vehicle Repossession
The first step to avoiding repossession is to make sure you’re communicating with your lender. Even if you just suspect things might be a little tighter financially and you might be late with a payment, call your lender right away. You might be surprised to find out that they want you to avoid repossession, too.
Repossession is costly, which is why most lenders are willing to work with borrowers who fear they may fall behind on a loan. This is the more affordable option for all parties involved. Not all lenders can help in every situation, but they may have more options for you than you realize.
When you’re trying to avoid repossession in Seattle, talk to your lender about these possibilities:
- Loan deferment – With loan deferment, a lender allows you to skip one or two payments, and adds them to the end of your loan. This gives you the option to stay current on your loan, while saving up to get future payments rolling in on time.
- Refinancing – If you’re having trouble paying due to a change in your financial situation, you may be able to talk to your lender about refinancing your auto loan before you get behind. The goal of refinancing is lower monthly payments, often achieved by extending the loan term or lowering the interest rate. Not all lenders offer this option, so there’s a chance you may need to look for another lender for this to work.
- Trading in your vehicle – In case you don’t have other options available, you may be able to trade in your car as long as you’re still current with your loan. This option works best if there’s equity in your vehicle, meaning it’s worth more than you owe on the loan. This way, you can trade it in, pay off your loan, and use the remaining balance as a down payment on a more affordable car.
If these options aren’t successful and you find repossession looming, you can make the process easier on yourself with a few simple steps.
Making Repo Easier
With repossession on the horizon, you should still keep in contact with your lender. Even if they aren’t able to help you avoid the repo, staying on good terms can make the process much smoother. Another option is to avoid the hassle altogether by turning in your vehicle rather than waiting for the recovery company to come and get it.
This is known as a voluntary repossession. It doesn’t avoid the repo showing up on your credit reports or the hit your credit score takes, but it does save you some money. Repossession is expensive, both for you and the lender. The less a lender has to spend to recover your car, the less you’re going to pay.
If you’re not ready to turn in your keys, you should be aware that a recovery company can repossess a vehicle at any time, from anywhere – sometimes, without notice. Whether it’s from your driveway, in front of a friend’s house, at work, or parked on Pike Street, the recovery company can take the car as long as they don't breach the peace.
When you can’t avoid the repo man, you need to know the options you have when it comes to getting your vehicle back. You have the right to redeem your auto loan, or possibly reinstate your loan in some cases, and you also have the right to bid on the car if it goes to auction. However, your best course of action may be to let it go and focus on getting a more affordable, reliable vehicle.
Getting a Car Loan with a Repossession
If you’re worried about getting an auto loan with a repo on your credit reports in Seattle, you should know that there are lenders out there that work with people in many types of credit situations, including bankruptcy and repossession.
In order to get a car loan after a repossession, however, you typically need to wait at least a year – unless you’re working with a buy here pay here dealership. These dealers might not even check your credit score or be aware of the repo, but you’re confined to the selection on their lot, which only includes used vehicles.
When the time is right, a better option is to let Auto Credit Express help. We work with a network of special finance dealerships all across Seattle and the rest of the nation.
These dealers work with the right kind of lenders to help people that are struggling with problem credit. We want to help connect you to one of these dealerships in your area, so you can get the car you need and start rebuilding your credit.
Simply fill out our fast, easy, and no-obligation auto loan request form, and we’ll get the process started. Don’t wait any longer – get on the road toward your next car loan now!