What To Do If You Can’t Pay Your Car Loan
When you can’t pay your car loan, a lot of thoughts and feelings are likely to rise to the surface. Whether you’re cool as a cucumber, or panic-prone, the most important thing you can do when you can’t pay your car loan is acknowledging the situation, your fears, and how you got into trouble. Having a clear train of thought will help you plan your attack to financial solvency—and may even save your car from repossession.
Establishing a Financial Map
Before you can be sure that you can’t pay your auto loan, sit down and plot out your finances. You may be surprised to find excess expenses to cut out that will free up your income to cover your car loan. If a sudden emergency or unforeseen circumstance throws your finances into a tailspin, things can get a little tricky—but don’t lose hope. Reach out to your communities (family, friends, or even co-workers) to see if anyone would be willing to help cover your expenses until you get back on your feet.
PRO TIP: If a workplace injury is the reason why you’re no longer gainfully employed and able to pay your bills, check in on your insurance protections. You may have disability insurance that can help cover your bills while you’re recovering.
Contact Your Creditors
If you know for certain you’re going to miss your car loan payment, and you’ve exhausted all your options to keeping up with your financial obligations, let your auto loan company know. Debt creditors, banks, and dealerships always appreciate advance notice, and may even be able to work with you to find a way to cover your payment.
Alternatively, if you’re working with a buy here pay here dealer in Wisconsin, you may be in a position to get into a lot less expensive vehicle, downgrading your loan into more manageable territory.
Surrendering Your Vehicle
As a last measure, consider surrendering your vehicle. It will hurt your credit in the short run, but in the long run, you can avoid heartache or even legal recourse. Surrendering your vehicle also shows your creditors that you’re not trying to shirk your responsibilities, and your dealership will appreciate your cooperation.