It seemed like you were getting a pretty good deal on your new car, and you were confident that the payments would be manageable. But things haven't worked out as well as you had expected. Either because your financial situation has changed (you've lost your job or an unexpected expense has come up), or you simply miscalculated your budget, you are now struggling to keep up with your monthly car payment.
Cash Strapped Car Owner Options
Once you have signed an auto loan contract, there really is no easy way out of the deal. However, there are a few actions that you can take to either make the burden bearable or minimize the potential damage.
- Tighten your budget. Take a look at your spending habits in order to see if there are extra costs that you can cut out. At this point, keeping your car and somehow managing the payments would be the best option. So, if being extra frugal with your budget for a while will allow you to follow through with your loan responsibilities, those efforts will certainly pay off in the long run.
- Negotiate with the lender. If you are honest and upfront with your lender, there is a chance that the loan terms can be modified. If you're going through a temporary financial setback, it may be possible to have your payments lowered for a few months, or you could even be allowed to skip a payment or two. It won't hurt to ask.
- Consider refinancing the loan. This will probably only work if you have excellent credit. But if your credit rating is high enough, you may be able to restructure your financing terms in a way that will make your payments lower.
- Try to sell the car. Take a lot of pictures of the vehicle, and advertise that it is for sale through several sources. And even if you can't get enough money from a buyer to cover the entire cost of your loan, you should at least be able to eliminate a large portion of the amount owed. You just may have to resign yourself to driving a very cheap car until the loan is entirely paid off.
- If all else fails, you can opt for "voluntary repossession." Use this as a last resort, because it is only a slightly better option than involuntary repossession. If you turn the keys and the car back over to the dealer, you will still be responsible for the difference between what you owe and what the vehicle sells for at auction, but you may be able to work something out with the lender to minimize the cost.
A Second Chance at Car Buying
If a car buying experience is haunting your credit history, Auto Credit Express can help you start over with a bad credit auto loan. Past mistakes don't have to prevent you from acquiring reliable transportation right now. No matter what your situation looks like, we can find a solution that works for you.
Just fill out our fast and secure application to start today.