Can’t Make Car Payment

What to Do When You Can't Make Your Car Payment

Life can sometimes throw unexpected financial challenges your way, and one of the most demanding situations is realizing you may not be able to make your car payment. Knowing what to do when you can't make your car payment is necessary because ignoring the problem can lead to late fees, damage to your credit, or even repossession. Fortunately, there are proactive steps you can take to protect your finances and your vehicle. By acting quickly and communicating with your lender, you can often find flexible solutions that work for you. This guide will help you navigate your options and reduce stress during difficult times.

Steps to Take if You Can't Make Your Car Payment

• Contact Your Lender Immediately - Be upfront about your situation; many lenders offer temporary hardship programs.
• Review Your Loan Agreement - Understanding your loan agreement, including grace periods, late fees, and the availability of deferment or refinancing, can empower you to make informed decisions.
• Ask About Payment Extensions or Deferrals - Some lenders may allow you to skip a payment and add it to the end of your loan.
• Consider Refinancing Your Auto Loan - Lowering your monthly payment through refinancing may make it more manageable.
• Explore Selling or Trading In Your Vehicle - If payments are consistently unaffordable, downsizing to a more budget-friendly car can help.
• Create a Budget and Cut Non-Essential Expenses - Free up funds for your car payment and reduce the risk of long-term credit damage.
• Seek Professional Financial Counseling - Credit counselors can help negotiate terms with lenders and provide budgeting strategies.
• Avoid Ignoring the Problem - Taking immediate action is crucial. Delayed action may result in repossession, which is costly and damaging to your credit score.
• Voluntary Repossession - If all other options have been exhausted, voluntarily surrendering your vehicle may be less damaging than a complete repossession.
• Seeking Professional Counseling - A financial counselor can help you create a budget or debt management plan and provide unbiased guidance.

What to Do When You Can't Make Your Car Payment FAQs

Q: Will missing one car payment hurt my credit?

A: One missed payment may not appear on your credit report if paid quickly, but late fees may still apply. After 30 days, most lenders will report it, which can affect your credit score.

Q: Can I refinance my car loan through the dealership?

A: Yes, many dealerships, including Spitzer Automotive, can help you explore refinancing options to lower your monthly payment.

Q: What happens if I ignore my car payment?

A: Ignoring your car payment can result in repossession and significant damage to your credit history.

Q: Can I trade in my vehicle if I still owe on it?

A: Yes, dealerships can work with you to roll over the remaining balance into a new, more affordable vehicle.

Q: What is the difference between a deferral and a loan modification?

A: A deferral is a temporary pause on payments, while a loan modification permanently changes the terms of your loan to make payments more affordable.

Q: What is a deficiency balance?

A: A deficiency balance is the difference between what you owe on your loan and the amount the lender receives from selling your vehicle after repossession or voluntary surrender.

Find Out More From Spitzer

At Spitzer, we understand that life can present unexpected challenges. We're here to help you find a solution that works for you. And as you navigate your way back to financial stability, our Spitzer VIP program is here to reward you. Every dollar you spend on service, parts, and accessories earns you rewards that can be redeemed for future services and accessories or applied toward the down payment on a new or used vehicle. The Spitzer VIP program not only provides a safety net but also a path forward, helping you get back on the road and stay there with confidence. Speak with our finance experts and learn more about how the Spitzer VIP program can assist you today!