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Can a bank garnish your wages for a car loan?
I’ve missed a few car payments. My bank was understanding at first, but now they’re telling me I need to pay the outstanding balance within the next two months. I’m not sure how I’m going to afford it. What will happen if I can’t? Will a bank garnish my wages for an outstanding car loan?
Jack Walsh · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
Repaying a
loan
can undoubtedly be tough, especially if you’ve fallen behind. However, if legal in your state, a bank can garnish your wages for a car loan—but only if the vehicle has been repossessed and sold for less than you owe.You should contact your bank immediately to avoid repossession. Plus, they’ll likely work with you to reach a repayment agreement that’s mutually beneficial.
Because you’ve missed a few payments, you may also want to consider refinancing into a new loan with lower monthly payments.
In addition, you can free up room in your budget to put more money toward your car loan by saving on other expenses—like
car insurance
. Jerry
makes it easy. Jerry’s an insurance comparison app that shops for low prices with over 50 different insurance companies for free.If you’re hesitant to switch plans or insurance providers because you’re worried about the work involved, don’t be. Jerry does all the paperwork for you and even helps cancel your old policy! And if you have any questions along the way, just text one of our agents through the app. The average Jerry user saves $879 a year.
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- Gregory R.
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