What happens if I stop paying my loan and let my car get repossessed?
I don't have money for my car payments anymore, and now the lender is threatening to have the car repossessed. What happens to me if I stop paying my loan and the car gets taken?
“A lot of different things can happen. You’ll have repo men waiting to pounce on your car. The lender will continue to hound you. But worst of all, your credit score will be severely damaged for the next seven years.
While your credit may not seem important now, think about buying a house or another car in the future. You won’t be able to purchase either.
If the car gets repossessed, the lender will often sell it at auction for far less than the actual value, and you’ll be on the hook for the remainder.
If you really can’t pay your car loan by any means, you should call your lender and work out a date to turn the vehicle in. Give yourself time to get your affairs in order or set up a new form of transportation. That’s probably your best game plan.”
Did this answer help you?
Ask us a question by email and we will respond within a few days.
Have a different question?
You can meet us at our office and discuss the details of your question.
Read advice from car experts at Jerry
Browse by topics
What others are asking
Why am I only being offered a $10 payout for damage due to a pipe leak?
"A pipe connected to a hose in my backyard was broken and leaking water. When I called a repairman, he made a hole in my house to access the pipe. There was also some water damage to my ceiling. When someone from the insurance company came over to check out all the damage, they only offered to pay me $10. Why am I being offered so little? "
Apr 05, 2021
How do I get car insurance in North Carolina if I do not have my license yet?
I live in North Carolina and the DMV here says that I can’t get a license without insurance … but I can’t get insurance without a license. What am I supposed to do?
Apr 29, 2021
Can I get a car loan for a $7,000 Lexus if I only work part-time?
"I want to buy a $7,000 Lexus. I'm going to sell my current car for $4,000, so I'll need to finance the remaining $3,000. I'm 20 years old and I have a part-time job making $800 a month. Can I still get a loan for this amount?"
May 21, 2021