CFPB Auto Loan Payment Options
On Feb. 12, CFPB issued guidance on auto loan payment options.
- Auto loan lender may have options to avoid falling behind during financial hardship.
- Missing Required Payments
- A temporary financial burden—such as a job loss, or medical emergency, or car repair—could cause a borrower to fall behind on his or her auto loan payments.
- Missing payments can have significant impact on your finances, these include negative credit reporting, increased fees on your loan, and repossession of your vehicle.
- If you think you may fall behind on auto loan, call lender and explain your situation.
- Contact Lender
- The sooner you contact your lender, the more choices lender may be able to offer you.
- It is often more expensive for a lender to repossess your car than to work with you.
- Working with lender demonstrates a good-faith effort on your part to repay your debt.
- There possibly are extra costs to the payment options that auto loan lender offers.
- Payment Plan, Refinancing
- Ask your lender to change the date that your auto loan payment is due each month.
- Request a payment plan that will help you catch up and repay missed payments.
- Payment extension allows deferring some monthly payments, thus providing a brief break for borrowers suffering unexpected financial hardships or a natural disaster.
- Refinancing your auto loan through your auto lender or another lender might allow you to get a lower interest rate which would reduce the size of your auto loan payment.
- A longer loan term would lower your monthly payments to a more affordable level.
- If practical, should consider trading in your current vehicle for more affordable one.
||Bank; CNSM; Thrift
||Client Money; Financial
||United States of America
||Banking; Loan; Payments
|Reg. Last Update
Last substantive update on 02/13/2020