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What happens if you can't pay your car loan?
I've had a few medical issues recently and the bills are starting to pile up. What happens if I can't pay my car loan next month?
Eric Schad · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
Sorry to hear that you can’t pay your
car loan
. Before you skip a payment, note that you have a few options.First, you can try refinancing your loan. By extending your loan payback duration, you should be able to lower your monthly payments to an amount that’s more manageable.
The
Jerry
app removes the hassle of refinancing by instantly connecting you with top companies to meet your financial needs. On average, car owners who refinance pay $85 less every month on their auto loan.If that’s not an option, you should contact your lender. Your lender is probably willing to work with you if you’re honest about your temporary financial hardship. They will likely work with you to come up with a solution and may even allow payment deferral, which would enable you to skip a few payments (with interest still accruing).
The last two options are less than ideal, but they may be something to consider if the first two options don’t pan out. You can either voluntarily surrender the vehicle or sell the vehicle and use the proceeds to pay off the loan. These will leave you without a car, however, so only do so as a last resort.
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- Gregory R.
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