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What happens to your car loan if you lose your license?
I just lost my driver’s license. As if that wasn’t bad enough, I’m still making payments on my car. What happens to my loan after I lose my driver’s license?
Eric Schad · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
Your car loan shouldn’t be affected by a suspended license. But if you can, try
to get your suspended license reinstated
in your state as soon as possible. As for your car loan, it’s business as usual: You must continue paying off your car loan even if you can’t drive.
The same goes for your car insurance policy. Although your rates might climb after losing your license, maintaining liability coverage is part of your financing agreement.
However, just because you can’t drive doesn’t mean you don’t have options. You could
add a driver to your car insurance policy
(like a friend or family member) and ask them to chauffeur you. You could transfer your car loan to another person
or sell the car with the existing loan. Adjusting to life without a car is challenging, but it is possible. Keep your head up and good luck!
View full answer
- Gregory R.
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