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SpanishWhat Should You Do if Your Car Is Repossessed?
Paying off a car loan can be a balancing act for some people, but one that is possible with the right amount of planning and proper budgeting. But occasionally, unforeseen circumstances can cause financial setbacks, including the inability to make monthly car payments on time.
If you miss one or more car payments, your lender is legally justified in repossessing your vehicle as a means of covering any outstanding debt. The experts at Indy Car Financing want to educate customers about repossession, what to do if your vehicle is repossessed, and how to avoid this situation.
What Does It Mean to Have Your Car Repossessed?
The repossession of a vehicle is the immediate seizure of a car by a lender in the event that you default on your car loan. While the lender often determines what constitutes a default situation, they are within their legal right to repossess your vehicle while your loan is in default.
Once your lender sells the vehicle, you’ll have to determine what your deficiency is. The deficiency is the difference between the value of the car sold and the remaining balance of your loan. Paying off that deficiency can have a negative impact on your credit rating.
How to Avoid Car Repossession
The best way to avoid vehicle repossession is to make sure your monthly loan payments are made on time. Before acquiring a car loan, you should go over your budget so that you know the interest rates and payments you can afford. Even if your budget is exact, sometimes problems do arise.
If your vehicle is repossessed, the best way to get it back is by paying the loan off in its entirety. This is known as your right to redemption. You can also reinstate your loan by paying off all overdue payments in one lump sum, but be aware that such a solution is only allowed in certain states.
Treat Your Lender as an Ally
It’s in your best interest to always treat your lender as an ally. If an emergency financial situation does arise, you can always ask your lender for an extension on your current loan or renegotiate terms. When doing so, get everything in writing from your lender so that if there is a problem, you have documented proof to support any claims. Also, having a strong history of making payments on time can help during the negotiation process.
Indy Car Financing Will Help You Secure a Loan You Can Afford
No matter what your credit rating or financial history may be, Indy Car Financing has the resources to get you behind the wheel of your dream car with a loan that fits your budget. You can contact our experts at 855-468-6215 to find out the best options for your situation.