Did you buy that brand new car a few years ago? Did you get all the bells and whistles on it? Heated seats, air conditioning, MP3 player? Well, it’s not a new car anymore and you are struggling to pay it. Are you in this situation? If you find yourself unable to make payments on your vehicle, you’ll want to act quickly. In the majority of states, if you miss a car re-payment, the lender has the right to repossess the vehicle in an instant.
The first thing you should do is talk to your finance company. If the lender hasn’t repossessed the vehicle, call the lender and discuss your options. You should find out if it’s possible to get an extension of your finance agreement. This will mean you can miss a few payments now and add them on at the end of the agreement. There is usually a fee of around $60 – $100 for this privilege.
If the lender will not give you an extension, they may be able to reduce your monthly payments by rewriting the finance agreement meaning that you will be given a longer time to pay, meaning lower monthly payments.
If your finance agreement is for the purchase of the vehicle, and you are certain that you won’t be able to make any payments for the foreseeable future, you may want to try and get out of the finance agreement.
You can either sell the vehicle on your own or give the vehicle back to the lender. If the sale amount doesn’t cover the money you still owe, you will have to make up the difference before the lender agrees to the sale of the vehicle. If you’re deep in debt and without any hope of repaying it, the lender may opt to waive the outstanding balance.
If you decide to give your vehicle back, you should be aware that you are still liable for the finance. The lender will sell the vehicle at an auction, where the difference between what it is sold for and what you owe the lender is your responsibility.
If it gets to the stage where your vehicle is going to be repossessed, you should be aware that in the majority of states, your vehicle can legally be taken from you just 60 seconds after midnight, the day after your missed payment. In about 12 states across the US, the lender must legally send you notice that you are in default and give you time to pay back the missed payments.
While it’s illegal to break into a locked garage, A repo man can legally take your vehicle from an unlocked garage or carport. Once your vehicle is taken, the lender may let you get back the vehicle, as long as you pay the instalments that were missed as well as the late fees. On top of this you will be liable to pay for the cost of the repossession as well as the storage costs.