Chances are, if you have hit hard times financially, you may also be facing repossession of your vehicle. Despite what you may think, your lender wants you to keep your car, and if making timely payments or catching up on your loan is out of the question, you may want to discuss your options with your lender.
Banks service millions of people each year. They are quite used to dealing with the occasional financial hardship. Communicating with your lender about your auto loan may be the best first step to take before repossession. Many times, lenders try to work with individuals to remedy their situation. They may offer to modify your loan temporarily, allowing you to catch up on it, or may even be able to defer a payment or two until the end of the loan. Regardless of your ability to pay, contacting your lender before repossessionis always a good idea.
If too much time has passed and your car is up for repossession, you can still contact your lender. If discussing your situation with your lender is out of the question, you may want to speak with an attorney about your rights. Many individuals are not fully aware of a repossession agency?s limitations. There are specific rules that these entities must follow when attempting to collect your vehicle. Likewise, there are specific things your lender must also do after having your vehicle repossessed.
If you are facing extreme financial struggle and wish to keep your vehicle out of repossession, you may want to consider filing bankruptcy. The most common bankruptcy, Chapter 7, allows debtors to keep their vehicle and reaffirm their auto loan. Of course, this option poses other challenges but working with an experienced bankruptcy attorney can help make the process a bit smoother. Although filing Chapter 7 bankruptcy may seem extreme, it can free up the income necessary to catch up and stay current on your auto loan.