What Happens If You Don’t Pay Your Car Payment?

What happens if you don't pay your car payment

Let’s face it. Anyone who’s seen Operation Repo knows ultimately what happens if you don’t pay your car payment, but of course your car doesn’t get repossessed immediately. So what happens in between your first missed payment and the time they send someone out to get your car?

That’s what we’ll explain below.

But first, here are the steps you should take before you miss a payment…

What To Do If You Can’t Make a Car Payment

Believe it or not, the best thing to do first (if you believe you’ll be able to keep making payments in the future) is contact your lender and ask if you can modify your repayment plan. When you get them on the phone you can tell them the following:

1. You won’t be able to make a payment this month. (If you’ve never been late before, be sure to tell them that)
2. You will be able to make a payment soon, but need a modified repayment plan.
3. Ask if they can let you go one month without a payment or possibly reduce the payment amount for a few months.
4. Ask if they can waive your late fee.

Some lenders may be willing to let you pay less for a few months or even skip a payment (known as deferment) – but the amount you defer will be added onto your loan balance, meaning you’ll pay more interest in the long run. That’s certainly better than losing your car entirely and damaging your credit score (which is what happens when a car is repossessed).

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Another option might be to refinance your loan. Refinancing can help to lower the monthly payment you’re expected to make. However, you’ll probably need a relatively good credit score to make that happen.

But what if you can’t pay the payments anymore – not now and not in the future? This is a common situation when people lose their jobs or have their income reduced. In that case, your best choice may be to sell your car entirely. And if you have an alternate means of transportation, selling the car should ease your stress and give you a way out of a difficult financial situation.

A final option, which may be quite unpleasant, is to “turn your keys in” – which means giving the car back to the dealer voluntarily. Keep in mind, even if you do this, you will still owe the difference between what the car is worth and what you still owe on the car loan.

What Happens If You Miss One Car Payment

Okay, let’s say you’ve missed one car payment already. Now what? Well, if you’ve never missed a payment before, the first thing that will probably happen is your lender will call you and ask why you didn’t make the payment. They will want to find out if you expect to be able to make the payment in the near future. If you can assure them that you will make the payment soon, they may be able to help you modify your payment plan as discussed above.

There is also a high likelihood that you’ll be charged a late fee or penalty.

Is there an impact to your credit score? Well, not right away. Usually, the lender will not report your missed payment to the credit bureaus immediately. So there may still be time to get the situation resolved before your credit is hurt. But that window only lasts for a short time…

What Happens If You’re 30 Days Late On a Car Payment?

Once you’re 30 days late on your car payment, the consequences get more serious. For one thing, the lender may report you as delinquent to the three major credit bureaus – Experian, Equifax, and TransUnion – and you will get several calls from your lender to persuade you to pay the amount you owe.

In many cases, these calls will increase as time goes on until you are more than 90 days late.

What Happens When You Are 90 Days Late On a Car Payment?

After 90 days without paying your car loan, your lender may declare you to be in default on the loan. After your loan is in default, it will be sold to a debt collection agency for a fraction of the total balance of your loan. At this time, the repossession process will also begin, which means the lender will send out someone to reclaim your vehicle.

If your car is repossessed, keep in mind that you have a right to save all your belongings inside the car. Even if the car is taken when you’re not around, you have the right to ask the lender how to get back any of your property that was in the car at the time it was repossessed.

So what should you do if your car is repossesed and you can’t pay the remaining balance on the loan? There are several options for getting out of debt that you should research. Depending on how much total debt you have, it might make sense to work out a repayment plan, or try to save up enough money for a lump sum settlement, or file for bankruptcy. You can talk to a reputable credit counselor for advice on how to proceed.

———

So… what happens if you don’t pay your car loan payment? As you can see, the answer depends on whether you can make the payment in the near future. Hopefully the information above can help you avoid the worst outcomes, like having your car or truck repossessed. The most important thing to keep in mind is if you feel you cannot continue making payments, take action immediately to try to resolve the situation rather than simply waiting or ignoring the problem.

And as always, if you have any specific questions, just let us know in the comments below!

Image credit: Stradablog

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  • chacha

    what happens when you buy a car and request your payment to be on a particular day of the month and the agree, then sell the loan to another lender an they don’t accept the original payment date? Then they start calling everyday all day long even when your not 30 days late.

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      That sounds like a frustrating situation. I don’t have any experience with a situation like that, so I’m not sure exactly what I could recommend. However, it sounds like the lender thinks you are late on a payment so it might be worth checking in with them to see if you can get on the same page and make sure they see that you are up to date on your payments.

      • Manny

        I bought a car about two months ago, and i called to make my first payment, and the original dealership had sent my contract to a new finance company and they shredded my file, the new finance company has no record of me or my vehicle. No one has called me for payment. What do i do?

        • http://www.twitter.com/bwfeldman Benjamin Feldman

          Hi Manny, wow, that is a very strange situation. I’ve never heard of that happening before. One thing you could do is get your free annual credit report from annualcreditreport.com and see if the loan is listed on your credit report. If it is, then you can see who the lender is and contact them for more information.

          It seems that whoever has your loan should be obligated to send you a bill so you know where to send payments. If you don’t hear from the lender and don’t pay, then either you’ll get a free car (which seems unlikely) or you will be tracked down at a later date by the lender and they’ll demand all your back payments.

          • Manny

            I have not heard fro the lender in a month, so im really confused..

          • http://www.twitter.com/bwfeldman Benjamin Feldman

            Were you able to pull your credit report using annualcreditreport.com? That may provide some answers. If you find any more information about this type of situation, let us know!

  • r.dodduk

    What happens if my car is taken and sold I know I repay the differnce but does that include all the interest I would have had to pay? They quote they have given me is a total repayment quote but when asked how much ir would cost to early repay its a totally different figure.

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      I’m not sure of the answer to this, but I think the amount owed is usually called a “deficiency balance.” If you have time, you might find some more information online if you Google that term. Best of luck to you.

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi there, I don’t think it would include the interest, but you should ask the lender to be completely sure.

  • Alicia

    how do I find out who my lending company is?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      The name of the company and their contact information should be on the billing statements you receive. If you are having trouble finding it, or if you have another question, just let us know and we’ll try to help answer it.

  • island girl

    I have not made a car payment in over three months and can no longer afford it due to my change in circumstances. I obviously know that I am in default, but they have stopped calling me and I have not received any info in the mail as to what their plans are. What should I do, just wait to the repo man shows up or should I call them? This is very stressful. Please help

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      I’m so sorry to hear about your situation and I wish you the best of luck. That must be very difficult. It’s hard for me to say exactly what should be done in your specific situation since I don’t know all the details, but it is usually a good idea to call the lender and see if you can work out some kind of modified payment plan. Or even see if there is a way to sell the car back while reducing the amount you owe. By talking directly to them you may find the solution that is best for your finances. Best of luck!

  • One Million Dreams

    If you are unable to make payments on the car for extended period of time can the bank make it so that you can not renew your registration? Also, can they make it so you can not renew inspection?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      I don’t think so – I believe the only way you could be prevented from registering your car is if you owed taxes on it. But you might want to double check by calling your local DMV.

  • Random Passerby

    If you “turn in your keys” voluntarily and owe more than the vehicle is worth, how do you pay that? Do you still own that money to the lender like the original loan? I ask because I just got approved through USAA for a suitable loan with a better interest rate(and overall better payment,) but would still owe the difference on my current loan. Also, if I took advantage of the newest loan offer, and then dealt with the current vehicle loan, would they affect each other?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi, I’m not sure I understood the last part of your question, but to answer the first part I’m pretty sure that if you turn in your keys while still owing more than the vehicle is worth then you’d still have a loan amount equal to the outstanding balance (probably with the same terms as before, too). In your case, if you have two loans, then I think you’d have two monthly payments to make. If you could pay one off quickly, then you’d just have the remaining one to focus on, which would be great! Let us know if you have further questions.

  • alvin

    what happen i i just bought a car this year and i cant afford it no longer what should i do??? im planning or voluntary to put it
    back to dealer thanks

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Alvin, I don’t know the specific terms of your contract, but I think you should be able to return the car to the dealer. After you do that, you’ll be in better shape, but you may still have some debt remaining from the car loan that was not paid yet. If so, continue making the payments on that until you have no further payments due.

  • richard

    i paid for this month just in time but when i got home i saw on my receipt that they just charged my account $450 and it supposed to be $465.56 will they charge me a penalty for the $15.56? since its weekend and labor day i will have to wait till the bank open on tuesday, i have always paid in time, just curious :)

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      If the mistake is theirs, you should be able to call their customer service line and ask them to fix the error. If you can provide them with proof that you paid the full amount on time, this will help your case. Good luck!

  • Jasmine

    Is there any way you can refinance your auto loan if your more then 90 days late ???

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      I’m not sure. The best approach will be to contact your lender or an alternative lender and ask what options they can offer you.

  • Lyle

    What happens if my car loan goes to collections nd I still have the car, r they still looking for it

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Yes, I believe if your loan is in collections they can repossess it. I’d recommend doing a little research (start by searching for information on car repossessions) and also make a plan for how to pay off this debt. If you can save up a lump sum then you might be able to offer that in return for having the remainder of your debt forgiven.

  • terri k

    my loan is with collections& Ive made arrangements and have been paying them however i can no long make those payments and need them to repossess the vehicle; I’m working on building my credit will this now ruin what im trying to build once again

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Terri, my understanding is that a vehicle repossession will hurt your credit score. You might want to call your lender and explain the situation. At least that way, they can arrange to repossess the vehicle quickly and painlessly and you can move on and start repairing your credit. You might want to check out our credit score resource center: http://blog.readyforzero.com/resources/credit-score

      • terri k

        Hi Ben

        Thanks for your prompt response but the lender already sent it to collections and I’ve been paying the collection agency; so my question is if I ask the collections agency to repossess the vehicle if this will hurt my credit?
        Subject: Re: New comment posted on What Happens If You Don’t Pay Your Car Payment?

        • http://www.twitter.com/bwfeldman Benjamin Feldman

          Most likely, the repossession will hurt your credit, yes. I still think it’s worth calling the collections agency in this case. If you’re lucky, you may get a customer service representative on the phone who can actually answer your questions clearly and accurately. The problem is many collections agencies are willing to use unscrupulous tactics to get money from you. I would recommend doing a fair amount of research on this so you can make an informed decision. These articles may be helpful:

          http://www.consumer.ftc.gov/articles/0144-vehicle-repossession

          http://www.consumer.ftc.gov/articles/0149-debt-collection

  • brandon

    I am going to miss a payment but I will be able to pay in with in the next 2 weeks should I be worried

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Well, you can’t know for sure whether this will be reported to the credit bureaus. But in most cases it would not be reported if you’re only 2 weeks late (unless you already have a history of late or missed payments). Good luck!

  • tracy

    i have a car i am making a payment on which i am late with the payment due to the fact i had a fender bender no one else my own accident my insurance lasped so i had the car at the shop they told me not worth fixing small damage but electrically problems airbag not deployed and caught on fire two weeks after i had it what can i do

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Tracy, sorry to hear about these challenges. It must be very frustrating. It sounds like your car has some major mechanical issues that will need to be fixed before you can drive it safely. And I’m sure it’s hard to deal with that and the late payment at the same time. Without knowing the specific details of your situation, it’s hard for me to say what you should do, but in most cases it helps to call the lender and see if you can work out an arrangement that works for both sides. Best of luck to you.

  • ormy69

    surly if ive paid 9o% off my car I have some rights before they reposess…ive asked if they will reduce the payments and they said no

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      My understanding is that they can repossess the car if you are not keeping your end of the contract, even if you’ve paid off 90% of the loan. Have you considered getting a short term loan from someone in order to get current on your payments so you can avoid losing the car?

  • Margareta

    Hi Ben,
    Two questions so I bought my car 42days ago and in the meantime I’ve been to the hospital 5times, with that said I haven’t been making $ and I can’t afford the 1st payment! Although I’m 13days late in actuality the company (dealer) told me at signing its not actually due till sep 14 either can’t pay it…and on top of that I wnt to go and register my car the other day and they didn’t all it cause they said I purchased the car 35days ago but it hasn’t been smoged in 90. So I have to pay $10 a day to basically to stretch the 30 day on my car so that’s there responsibility right? And they have to pay me bc for the $10 a day extension???
    Have a great day Ben

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Margareta, thanks for your question! I’m really sorry to hear about your hospital visits and I hope you get well soon. With regard to the car, it sounds like these payments are adding stress to your financial situation. With that in mind, you might want to consider returning the car (if possible) and getting a more affordable vehicle (perhaps a used vehicle from an individual selling their car on Craigslist). Whatever you decide to do, it’s a good idea to call your lender and tell them the challenges you’re facing and see if they can help you work out a solution. Best of luck!

  • jcextra

    Hi I have a 73 month car loan that I purchased brand spanking new back in 2010 and the original car payment (to pay off) was 19,230.87…well now I’ve gotten that down to 11,875.73 I purchased the car in May 2010 and they set my car payments up to 443.15. Well I have a job where the pay scale used to go up and down where one month we would be making 1900 dollars a month and another month we would be making 1600 dollars a month which translates into 400 dollars a week or 460 dollars a week. Well now my payscale is set at 360 dollars a week and i still have three years left to pay on my vehicle. I have not missed a car payment in three years since I’ve owned the vehicle. I have however made the payment sometimes on the 12th which is the due date, and sometimes i have been as late as the 26th, no biggie. What can you suggest i do to make the payments easier on me so i can go ahead and pay this car off as scheduled without any interruptions? And can I actually qualify to get my payment lowered from the 443.15 a month that i am paying now? NOTE: Keep in mind everytime i pay the 443.15, its only knocking 200-250 dollars off the principal balance. They are charging me a TON Of interest What can I do to get this lowered. Does it sound like i will qualify for a re finance and will this be the best way to do it?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi there, sorry to hear about this challenging situation. What I would recommend is calling your lender and seeing if they are willing to work out an alternate payment plan that will work better for you. Unfortunately, this is basically up to their discretion, and there is a chance they won’t want to do it. If you start to feel like you cannot make the payments anymore and the lender won’t help you out, then you might want to consider trying to sell the car and get something with a lower monthly payment. Either way, good luck!

  • Manny

    I bought a car about two months ago. The original dealership (In house financing) sent my contract to a different in house finance company (never heard of this happening) I have not made my first payment because when i called the new finance company they had no record of my vehicle or me. and the old dealer had shredded my file. What do i do? The original dealer is on my title as a lessor, and i am listed as lessee, but im Owner #1 and they are owner #2. Can i take them off of the title since no one has record of my contract? No one has contacted me for the payment either. @BenFeld:disqus

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hey Manny, I responded to your other comment below, but I also wanted to mention that you could seek legal counsel if you’re unsure of what your options are under the law. Let us know what you find out!

  • miss tlb

    *waves hand* I have a question. When a deferment is granted, and lets day the car note is $500. My auto lender would grant a deferment (skipping a payment, added 30 days to the end of my contract) Lets say its Sept and I have a payment due and not enough money. I’m granted a deferment. That month (Sept) I would pay only the finance charges (part 1). (200) and the next month (Oct.) I would pay the principle portion (300).
    So should they take additional finance charges out of my Oct payment (part 2 of deferment/principle) ?

    • miss tlb

      part one and part two would equal a full month payment*

      • http://www.twitter.com/bwfeldman Benjamin Feldman

        Hi, I think if I’m understanding your question correctly they should only charge you the normal finance charge for your October payment. In other words, your October payment would be $200+$300, as usual. Then you have to pay the extra $300 you deferred at the end of your contract, which means your loan lasts 30 days longer (and this might change your interest amount slightly, but I’m not sure how those calculations would work – you may have to ask the lender about that).

        • miss tlb

          That’s what I thought. My Auto lender granted us 6 deferments over six years. those 2nd part payments (principle ) had interest taken out as well as part 1 payment of deferment. They refuse to fix this mistake. We owed they repossessed my car for the last payment, actually it was only part of the last payment that was past due ($130), Hopefully the CFPB will make them do something =)

          • http://www.twitter.com/bwfeldman Benjamin Feldman

            So they repossessed your car when you owed only $130 on it? That seems a little suspicious. And it was because of an error on their part? Yes, if that’s the case I really hope the CFPB can help you!

          • miss tlb

            CFPB started investigating them in March for inflating (sub prime?) auto loans. They also applied a payment to my account, removed it the same day and re-applied it the next. Costing me $5 in extra interest (and $5 less on my principle payment ) they are trying to tell me that didn’t make a difference.
            Do you know if this is true? I read this while reviewing complaints on other websites about my auto lender: If more than half the car is paid, auto lenders are required to offer re-financing BEFORE they repossess. This is suppose to be enforced my the FTC?

          • http://www.twitter.com/bwfeldman Benjamin Feldman

            I don’t know if that is true, unfortunately. But it’s probably worth researching more. By the way, which lender is it? That would be helpful for us to know if we run into a similar problem in the future with others.

          • miss tlb

            Ally Financial. The will steal your car and your soul. NEVER use them! Customer service is horrible!(outsourced). They tried to tell me my first two payments don’t count, told me this TWICE! (2nd time I recorded it)

          • http://www.twitter.com/bwfeldman Benjamin Feldman

            Oh wow, thanks for the heads up! I can’t believe they’ve treated you so badly. I hope you’re able to get the situation resolved. Best of luck!

          • miss tlb

            Thank you

  • tenisha lamar

    Waves Hand, Yes I have a question my account goes into to default today after 3pm and my question is after it goes into defalut and sent to a collection do my car company come pick my car right away and with the collection agency how would that go, would they ask me to pay what I owe or would I have to pay double the money. I really need my car I am a single mother. This car has already been giving me problems since I first got it but I really need it.

    • tenisha lamar

      also they said I am 3 payments behind when I had already told them I get paid bi-weekly and I also informed them that my payday is in 5 days and they’re not willing to take my money.

      • http://www.twitter.com/bwfeldman Benjamin Feldman

        Hi Tenisha, I’m sorry to hear about these challenges! Most likely what will happen is they will sell your debt to a debt collections agency. This could happen immediately or after a month or two. To learn more about how to deal with a debt collector, see this post:
        http://www.consumerfinance.gov/askcfpb/search?selected_facets=category_exact:debt-collection

        Usually, with debt collection you are asked to either make monthly payments or pay an up front sum equal to some fraction of the total debt owed.

        As for your car, they may eventually repossess it. I can’t say for sure if that would be immediate or not, though. Best of luck to you.

  • dominic

    Hey Benjamin, i have made perfect payments on my car for 2 years, i still owe 20k on it. however my financial situation has changed and i cant afford it anymore. i was wondering since i already have terrible credit, if i tell my bank to stop the payments, pocket the money and put it towards a beater car. im just worried that the car will be repossesed before i can save enough for a cheap car. (only need about 2 months since my payments are 250 bi-weekly.

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Dominic, sorry to hear about your predicament! I think you’ve got the beginnings of a good idea — if you can get out from under your car payment and drive an old beat up car for a little while, it will give you the breathing room necessary to get your financial life back on track.

      Can you start saving now (while still making your car payments) and wait until you get a big enough amount to buy an old car? And then call the lender on your current auto loan and see if you can give back the car or sign over the payments to another customer? That way, you won’t get behind on payments and your credit score won’t be affected. Good luck, and let us know how it goes!

  • iris

    I have a brother who can not drive due to illnesses..His girl friend of 23 years has drove him everywhere. she now has passed away they have a truck in both there names and he can not afford to finish making the payments on it..He draws ssa disability. What shoul he do?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Iris, I’m really sorry to hear that. It must be very difficult. It sounds like he may need to get rid of the truck and look for alternate forms of transportation. If he were to stop making payments, the truck could be repossessed – or it might not. That depends to some extent on what type of truck it is and its current value. He could call the lender and ask to return the truck so that he can stop making the payments without hurting his credit score. But then he’ll still need to find an alternate method of transportation. Perhaps there is a local community group that would be willing to pitch in to give him rides every week? It’s worth a try!

  • seahorse

    live in florida, my car was part of chapter 7 one and a half years ago, can non longer pay, should I call them 2 months behind now

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Yes, I think it is usually a good idea to call them and see if they are willing to arrange a modified repayment schedule. For example, maybe they can give you a deferment or reduce your monthly payments a little bit. Or perhaps they’ll want to repossess the car. But at least you’ll know your options if you call.

  • steven

    I had a car and it had my and someone elses name on it but she wanted it cause i got married and told her she could have it the repo man called me and i gave him the information to get it and then the security national people called me saying i owe 12000 on it but he could get it reduced. what happens if you never pay it

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      That’s an interesting question, Steven. Since your name was on it, most likely the delinquent payment has already hurt your credit score. If you want to try to improve your credit score, you could talk to the debt collector to see if they will be willing to accept a reduced payment (if you can afford it, that is). If you simply do nothing, you’ll continue owing the $1,200 and your credit score will be affected negatively for about 7 years. But since you don’t have the car, there is no threat of repossession. Most debt has a statute of limitations on it. You can learn more about that here: http://www.bankrate.com/finance/credit-cards/state-statutes-of-limitations-for-old-debts-1.aspx.

  • Jasmine

    I’ve recently bought a brand new car in April. Just two days ago, I was terminated from my job. By the grace of God, I’ve got a new job lined up (tomorrow’s my second interview, fingers crossed). My car payment is also due tomorrow. I can pay it this month but I’m definitely going to be a week or two late. Do you think that is going to be an issue? I typically always make my payments on time, give or take a day or two

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Sorry to hear about the job loss, but congrats on getting the new job so quickly! I think if you make your payment this month within the first two weeks after the due date you should be okay. You might want to call your lender to let them know what is happening ahead of time.

  • Chrissy

    I unfortunately have been chronically late with my car payments but I always pay the late fee. This month I was 8 days late and went to pay with the automated service and they would not accept my payment with late fees. They want the full loan amount. Is there anything I can do. This is our only vehicle, I have 3 children and if we loose this car both my husband and I will lose our jobs. Obviously if we had the full amt the car would be paid off or have a second car. Help!!!

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Chrissy, sorry to hear that! It must be so frustrating. I would recommend calling up your lender (they should have a 1-800 customer service number) and when you get a real human on the phone, ask them if they can help you set up a new payment plan. They should be able to help you figure out how to get your payments restarted. If not, they may be trying to repossess the car back from you. If you feel you’re being illegally prevented from making your payments, you could contact the CFPB or your local law enforcement. Let us know how it goes. And good luck.

  • lewis schneider

    I have an 84 year old friend. He has a 3 yer old car with a 6 year loan. He lost his job injuries and cannot return to work anymore. There is no way he can make any more payments now or ever. He gets social security and can barely pay his food and rent bills. He has about a thousand in savings. When they repo his car can the bank take his savings? What should he do.

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Lewis, fortunately, I don’t think the lender would be able to take his savings. They can repossess the car and if they wanted to sue him for debt owed they could do that, but the likelihood of that is not particularly high.

  • eddie

    Hi there I was financing a car and decided I could not make any more payments after 8 months it’s been about a month now since I haven’t made a payment and the finance company asked me to sign a contract that states I will owe them 3000$ if I give the car back what should I do should I even sign this contract

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Eddie, that is a tough question to answer without knowing more details. If you prefer to have a $3,000 debt without the car (rather than keeping the car and being responsible for the entire loan amount), and if you think you’ll be able to pay off that amount, then that may be the best option. If that doesn’t sound good to you, then you’ll have to ask them what other options there are.

  • chris

    Hey been i just found out im being medically dischsrged from the army jan 1 2014 I have a 508 car note 2 kids and a wife my disabilty ratings is 20percent or 255 a month what should I do I sent a lrtter of hardship yester day and nothing yet what should I do give the keys to the dealer

    • tlb

      don’t turn your car over yet. You should have options, esp having been in the military. I think you can call the CFPB and ask questions like this. There are laws that protect military people from being taken advantage of by lenders. Whatever deal your lender works out with you be sire to get it in writing!

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      The previous comment by “tlb” is good advice. It doesn’t hurt to call your lender and explain your situation (including the military medical discharge) and see what they can work out with you. Ideally, they can work out a payment plan that you agree to, but definitely don’t hesitate to contact Military organizations or the CFPB for more info and advice.

  • CAM2286

    My auto loan was sent to collections recently but has not been repossessed but have asked for my location to come pick it up.i was 3 months behind and gave them two months payment to start catching up.ny question is,as long as I pay what I can to catch up,can they still repo my truck?the lady almost refused to take the 2 payments I had bc she wanted all 3.she was pretty brutal towards me.absolutely zero sympathy without hearing my side and why I was in that situation.

    • tlb

      u have a loan with Ally ? If you made those two payments I would make another one as soon as you can. I would secure my car in a safe location. ESP if you have a loan with ally

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      My understanding is that they can repossess the car as long as you are not up to date on your payments. Sometimes the lender will be willing to work out a modified payment plan with you, but in this case it seems your lender is not being very helpful. It might be a good idea to call them again and see if you can get a different person on the phone (who might be more helpful). Other than that, if you can get current on the payments, that should protect you from having the car repossessed.

  • Bianca

    Hi Ben,
    I have made perfect payments on my car for almost two years now. But recently, for the month of November, I’ve missed that payment and security national called me today saying that they need Novembers payment sometime this month and that they cannot wait another month. They are telling me that the collections department will be contacting me shortly if I don’t make a payment very soon. I just started a new job, got off of unemployment and the transition right now is hard because my check isn’t lining up to my bills just yet. My question is, I really cannot afford my car anymore, it’s also been wrecked due to a drunk driver, badly. I am thinking of just giving the car back to them, because I really cannot afford the 451 dollars plus 154 in insurance, plus my rent and utilities all in one month anymore. Should I just give the car back? Would I owe the balance still? I still owe $13,000 on what started at $15,000 a year and a half ago. I’m thinking that saving up for a beater might be what I will have to settle with. thanks

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Bianca, it sounds like you’re on the right track in planning to get a cheap used car in order to allow you to get control of your finances and start saving up some money. In some cases you can give the car back and not owe any more, but I think it depends on the current value of the car and how much you’ve paid already. What I’d recommend is Google the term “voluntary repossession” and then call your lender to ask if you can give them back the car. Good luck and let us know if you have further questions.

  • Petra Smith

    Hi my name is Allan and I got a car for a friend under my name but she is paying on it if she misses a payment how can I get the car back in a leagel matter need help

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi, my understanding is if the car is in your name (and the loan is in your name) then you are responsible for the car and all finances associated with it. That means if the payments don’t get made, they can repossess the vehicle. Now, if you’re asking how to get the car back from your friend if she misses a payment, that is a harder question and one for which I’m not sure of an answer. You might need to enlist help in that case.

      • Petra Smith

        Thank you

  • Rafa

    My contract was over a month a go but I’m still getting late charge I might have missed a car payment or 2 but can they still add late charge if the contract was suppose to be over and not to mention that the dealer has 2 contracts for me how is at possible?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Rafa, I’m not sure about the 2 contracts – that is something you should definitely resolve with the dealer in case it leads to further complications for you later on. As for the contract continuing past the original end date, that is not too uncommon if you missed a car payment (or a few). And I believe they are within their rights to do that if you still owe them the money. It might be worth calling the company to clarify with them how much you still owe. Hope that helps!

  • adon

    my car was towed. I dont want it anymore but there is property of mine in it that is important to me. what rights do I have.

  • alico

    hello
    I got a personal loan from a bank to buy a car and this was since
    one year and a half .

    now I lost my job and I can not afford paying my loan at least for the next three coming months

    my question is the bank able to repossession my car or not ?

    the car is registered on my name

    thanks

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Your best bet will be to call the lender and and tell them the situation. You might be able to work out a modified payment plan or a voluntary repossession. Hope this helps!

  • David

    Hi Benjamin,

    I’m a 19 year old, who got a new car a year ago and put it in my fathers name. I’ve paid all the car payments through my bank account for the past year, is there anyway to transfer the title of the car under my name, so that I may recieve all this great credit?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi David, I think that should be possible but I’m not familiar with the exact steps you’d need to take. I would recommend you start by calling your lender and tell them what you’d like to do. Hopefully they can help you to make it happen.

  • Geoff Jackson

    Im late on my payments. Can my finance prevent me from re-registering my car?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Geoff, no I don’t think it would prevent you from being able to register the vehicle. But I would ask your department of motor vehicles to be sure.

  • Talon

    Hi benjamin this is off topic but when buying my car i bought it from a used dealership i financed it thru my credit union so for the down payment i signed a promissary note to pay 2000$ I gave 800 cash that day an within the following month i paid the balance in full, this was over a year an a half ago today i get a call saying they started going thru there records an told me i still owe 675.00$ ive moved since then an only have the contract of buying my car no reciepts of payin the down payment part how do i prove i payed it? this place is known for ripping people off

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Wow, that is too bad. Maybe you should start by explaining to the credit union that you already paid them in full and ask them to update their records. Unfortunately, other than that I’m not sure what you can do besides talk with a lawyer. Best of luck to you.

  • big baby

    hello to you all i have a friend we are co on ownership of a car i second on it not able to make this months payment. want to keep the car just don’t know how to tell them with out being whinny or scared that they would say. I’m taking it. been out of work 3 weeks car payment coming up. Just some words to give to 1st on the car to let them know i can’t but will the beginning of the year when back to work

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      I would recommend being honest and explaining the situation while assuring them you will get back on time with the payments once you are back to work.

  • Samuel

    I have some question ? I can’t make a payment a car and I still own a car for $50,000. If I retune a car i still own $20.000.what should I do? If I retune a car. How is my credit gonna be? Possible I can buy to car on future ?

    Thanks

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Samuel, it really depends on the situation, but in many cases you can work out an agreement with your lender to return the car and it might lessen the impact on your credit score. I’d suggest doing some research on the term “voluntary repossession.”

  • Sally Welborn Switzer Lasby

    I have had a loan thru drive time for almost 14 months. Do you know if they would defer my payment this month to the end of the loan.

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      I think there’s a good chance that they would. I’d recommend calling them and asking if they’re willing to do that.

  • Ronin

    Hi Ben, I have a difficult situation, last August I went down to Mexico in my car then flew backto usa and left it with my aunt then my boyfriend who’s mexican drove it up to Phoenix where I live, but before he could get to the Phoenix the mexican police detained him with my car and although i showed up and showed that Iwas the legal owner they kept my car. So my question is if I stop paying my loan of 15k that I still owe on my car and the bank has no car to repossess what will they likely do? I can’t keep paying for a car that I don’t have. I don’t know what to do.

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Ronin, I’m sorry to hear about this challenging situation. I’m not sure what the lender would do in a situation like this, but we can assume your credit score will take a hit. Beyond that, the lender could potentially sue you to recoup more money from you – however, I don’t know if that will happen or not. I’d suggest calling them and telling them what happened. Then ask for their advice on how to proceed. You could also contact U.S. authorities about your car that was taken.

  • Lauren

    Hi. My boyfriends car was just repossessed this morning and he is at the place right now getting his things out of the car. In February will be one year that he has had the car. My question is if he paid one payment late in August, talked to the bank to push back a payment in October paid that, then missed a payment last month and was to make Decembers payment today would they reposes his car? Or has he not been paying it like he says he is? It’s been a very rough couple of months financially for us so I want to make sure things are okay and he’s just not acting like it. Thanks!

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Lauren, my understanding is a lender can repossess a car even after only one missed payment. However, it usually depends on that specific situation, so you might want to call the lender directly and see if they can help answer your questions. Good luck!

  • MsSmiles

    If u have made a payment in 6 months or more can they send the sheriff to your home?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      They could repossess your car, but that would not involve the sheriff, as far as I know. Your best bet might be to call the lender and work out an agreement with them. I’d also suggest researching “voluntary repossession.”

  • jc

    Im two weeks behind on my car payment and the lender called me and said that he was giving me 24 hours to make my payment I cant pay until the day after the 24 hours can they take my car

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      I doubt they would take your car in that case (assuming you make the payment) but I would suggest reiterating to them that you will make the payment on that day. Good luck!

  • canadian

    Hi,
    I bought a car in canada over 3 years ago and was paying on time even though i moved to us. the problem is that since august i haven’t been able to pay anymore, and even left the country in search of a job. now that i’m back i found that the loan it’s being sold to a collector in 3 days, tried to negotiate with the lender but they want a lump sum for the amount i’m behind, which i can’t do. i need to keep the car because is my only mean of transportation. can i try to refinance here in the us? negotiate with the collector? what would you recommend? thanks

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      It depends on a few factors. If the car still has a lot of value, they may try to repossess it. If that’s the case, there may not be much you can do besides plan ahead for the day it happens. On the other hand, you might be able to negotiate with the debt collector – it’s always worth a try. Good luck!

  • hurtandcantwork

    If you get disability and had to stop working but still can’t afford payments what happens? Is it best to turn in car?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      That might be your best option, but first you should call the lender and tell them the situation. It’s possible they’d be willing to work out a modified payment plan with you. If not, you can ask them about voluntary repossession.

  • Bianca

    Hi, if I am more than 90 days late but want to sell the car and possibly get another vehicle, what would my options be? This situation concerns me about my credit score and it being affected.

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Bianca, that depends. Can you find a buyer to cover the cost of your outstanding loan balance? If so, then you could sell the car and get out from under the loan. Then you’d be free to find another (cheaper) car to purchase. If you need to give back the car without paying the loan in full, then things will get a little more complicated. Your credit score would likely be negatively affected unless you could work out some kind of deal with the lender.

  • nic

    Hey ben, I currently am switching jobs and will not be able to make my next payment . Im nervous to call and ask them to let me miss one month or push the payment to another date….they dont repo it if u miss one payment do they?
    i dont want to lose it cuz then I will have no credit.after this month id be fine its just the current situation that money got tight.

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      If you think you’ll be able to make the payment relatively soon then you could call and tell them you are switching jobs and will need to submit the next payment a little late. They sometimes will agree to accept a payment late if you call in advance and explain the situation. In most cases, they would not repossess the vehicle after one missed payment, but if the payment goes unpaid for a long time with no communication from you, then they might take action. Good luck!

  • I hate Nissans

    Hi ready for zero! I have a question….my 2012 Nissan rouge is 64,000 miles and is out of warranty. I need a new transmission that will cost me 3000+ dollars. I’m already two months behind, I was thinking of letting them repo the Nissan. It’s a crappy car that will have future problems as well….do you have any suggestions or think this is a good plan?

  • carlos

    I have a 2013 Toyota camry i just have 1 payment and somebody crash me.the insurance say it can be fix.i was hopping they say is total.now when they fix it my new car is wort a lot less.i was thinking turning the car to the bank .and buy another before.but i am undecided .i don’t want this car anymore.

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Carlos, if the other person’s insurance is going to pay to have your car fixed, perhaps you can closely monitor the repairs and make sure they do a good job. When it’s all done, it should be almost as good as new. In that case, maybe you’ll be happy to keep driving the car? If not, you’ll need to sell the car or work out a deal with the lender to return the car (you’d have to call and ask them if this is even a possibility). Either way, I wish you the best of luck.

  • GT

    Hi,

    My situation is complicated. I refinanced my wife’s car under my name and was initially advised she could gift me the car to save tax. The new bank refinanced the car and sent me the clear title with no lien and my wife’s name on it so i could transfer it to my name and add them as lien holder. unfortunately when i contacted the dmv to follow thru with paper work they stated i will have to pay tax on the amount loaned even though my wife gave me the car. I didn’t have the money to pay for tax title as it was almost $2000. I contacted the bank and they refused to pay the $2000 as well and stated that ill have to come out of pocket and if i don’t do that within 60 days they will increase my auto loan rate to unsecured rate until the title is perfected. I paid them the agreed monthly payments but when the increased the rate I couldn’t afford the payments. I have lost my job and currently unemployed and cannot afford the ridiculous high monthly payments. I am about 60 days late and what are my options. I have the title with no lien under my wife’s name and cannot afford to make payments. Can bank still repossess the car without any lien or whatever my options are please let me know ASAP. Thank you

    GT

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi GT, that is a tough situation – sorry to hear about that. My understanding is that they can still repossess the car even without a lien, but I’d recommend you do some more research to get a definitive answer.

  • titou

    hi i just purchased a new car 3 weeks ago and i want to return it to the dealer after i signed a sale contract. is that can be bad for my credit? what i have to do?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi there, I’m not sure if that is allowed by the dealer. You’d have to call them and see if they will accept a return of the vehicle. If not, an alternative might be to sell the car for as close to the amount you paid as possible. And then you would need to still pay any remainder on the loan. If you simply stop making payments, then yes, that will be bad for your credit.

  • megan

    what happens if you cant pay your car payment anymore and no longer have the car?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Megan, the loan is still valid even if you no longer have the car, so your lender will expect you to continue making payments as agreed upon in the contract. If you’re having any problems, you can always call the lender and see if you can modify the agreement to make the payments more affordable (or to get a deferment).

      • megan

        what if you no longer can even make payments and havent for about 5 months now. I just am wondering legaly what will be done to me if i stop making payments and cant return the car.

        • http://www.twitter.com/bwfeldman Benjamin Feldman

          In that case, the lender could potentially sue you for the remaining balance.

  • mike

    If you have 2 cars with one lender and one of the is totaled and the insurance church does not cover the balance of th totaled car.and I stop paying on the totaled car but stay current on the other car can the lender take both cars?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      I don’t think so. My understanding is that the loans and cars are separate, so they can only repossess the car that’s attached to the late or non-paid loan. Of course, they could potentially take you to court to recoup the remainder of the balance from you, but that’s a different story.

  • Jerry G

    I turned in a 2013 car that I had less than 6 months due to losing a job and I knew I couldn’t pay for it. I still owe $8,000 after they sold it for $16,000. The car was priced at $19,000.Taxes and interest I guess. I only make SS of less than $1,000 a month and $180.00 from a property management company. Can they take any of this money? I’m trying to work out something but no good. I really don’t know what to do. They want the whole sum. If I had that I would have kept making payments.

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Jerry, my understanding is they cannot garnish wages or social security checks. The one exception would be if they sued you and got a judgement against you then they might be able to recoup some money from your monthly income. But it would be worth researching a little more to find out exactly what the possible outcomes are.

  • Popcorn

    Heres an interesting situation. I buy a car, the first deal gets messed up because i didn’t finish the “welcome call” in time. I go in and sign a new deal, waiting for the “welcome call” and it doesnt come. I drive the car halfway across the country because I am going back to school. I was prepared to make payments. No one ever calls me, the dealership never calls to get it back. The title got sent to my new lender, but that lender has no record of me. Right now I have this car and no one asking for payments. I tried contacting dealership early but then stopped. Its been almost 5 months now and I have yet to make a payment. I am just waiting for someone to contact me because I am tired of calling around and getting nowhere. Have you ever seen anything like this? Its just crazy, and I pretty much just staying quiet until my first bill is due or the dealership wants their car back. Until then I’m just gonna enjoy it while it lasts, lol. Maybe a little unethical but i’ve tried and if there is a problem it is one of their responsibilities to fix it. I could care less if I had to give the car back or make the payments but at this point, I might as well ride it out. Funnier thing is the DMV sent me a confirmation of ownership on the car. Bizarre situation.

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      That’s really interesting. I think someone else on this thread mentioned a similar situation. One thing you could do immediately is check your credit report at annualcreditreport.com and see if the loan is listed on your credit report. If it is, then you’ll know who the lender is and you should contact them to find out why you haven’t received any bills yet. Your credit report should also show you whether any late payments have been recorded yet. Let us know how it goes!

    • Tyler

      Is your car a 2012 Mitsubishi outlander?

  • Holly

    I missed a car payment in November but paid as usual in December. This month I am struggling to be able to afford to pay the monthly payment. What is the likelihood of repossession? I don’t want the car to be repossessed as I use it for work but there is no way I can afford to pay this month. What can I do to stop this?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Holly, usually the best option is to call your lender and see if you can work out an agreement with them to defer those payments. Sometimes lenders will agree to add your payments onto the end of the loan (in other words, you will have to pay the payment at the end of the loan term instead of right now). If you don’t make your payments then the lender can repossess the car, although they will often wait a little while before going that route.

  • Quintel

    hi Benjamin i got a car in november i was paying my car notes on time but lost my job and havent payed my car not for December or January can i just drop off the car and keys and just left or what would happen next

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Quintel, the best thing to do would be to call your lender and try to arrange a voluntary repossession. Be sure to get any agreements from them in writing. In the meantime, it may be worth doing a little more research on this topic. Here’s a good place to start: http://www.consumer.ftc.gov/articles/0144-vehicle-repossession. Good luck!

  • Kyle

    Hi Ben,

    Several years ago, I co-signed a car for my lil sis, (yep stupid me). Anyways, she couldn’t keep up with the payments so I took the car from her and tried to get caught up on the payments. At the time, I’m also making payments on a car that I just bought not too long after she bought hers. Total payments on both cars was upwards of $600, for someone barely bringing home $2,000 a month, its very tough with rent and insurance and all other bills.

    Anyways, I decided to give back both cars to the lenders and now I’m stuck with a $4,500+ bill with no car. I’ve been receiving collection notice that the lenders are willing to cut the bill down to about 1/3 of what I owe. My question is, if I somehow can manage to pay off that bill would that clear everything up and I’ll never hear from them again?

    Thanks,
    Kyle

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Kyle, yes, that should clear everything up – HOWEVER, please be sure to get the entire agreement in writing and signed by the lender before you fork over any cash. We’ve heard of instances where a lender or collections agency made a verbal commitment to settle a debt for a fraction of the balance and then, after receiving the payment, said the person still owed the rest of the money. You should also know that settling a debt in this manner will likely affect your credit score (though you could try to negotiate that part with them too). For more information on your credit score, see this resource center: blog.readyforzero.com/resources/credit-score.

  • Ali

    Hi
    I bought a car from private sealer, I did not know the car is finance, just wondering , what will happene if the previous owner stopped the payment,?
    The car is already transfered under my name.
    Thx

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Since you bought the car and are the new owner, the payments of the previous owner should not affect you (in theory). That is, unless you signed a contract agreeing to take over the payments. Either way, make sure you have the vehicle title and registration in your name and in your possession. If someone tries to contact you about the previous owner’s payments, refer them to that person. And it might not hurt to check up on your credit report while you’re at it: annualcreditreport.com.

  • Josh

    i need a solution. i borrowed 5000 from Quality Auto Sale to buy a car. when i didnt pay the loan or return the car, Quality wants to transfer the rights to the payment to Rapid collection agency. rapid agress to pay Quality for this right, but for a price that is less than the amount owed. can Quality transfer this right to rapid without my consent? what can i do next can refues to pay Rapid too ? whats gonna happen?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Yes, I believe they can transfer the right to collect your debt without your consent. You may be able to negotiate a payment with Rapid to clear the debt. Or if you cannot pay, you’ll want to research your options and rights. You can start here: http://www.consumer.ftc.gov/articles/0149-debt-collection.

  • sadgirl

    I lost my job as well. My car has already been reposessed. When I receive my tax return can it be garnished from me by the loaners?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi, my understanding is they cannot garnish wages or tax returns. The one exception would be if they sued you and got a judgement against you. But that process would take a lot of time and effort on their part. So they might not do it. Ultimately, it will be worth you researching a little more to find out exactly what the possible outcomes are. Good luck! And let us know if you have other questions.

  • Patrickatrick

    Ok so I bought a truck from a buy here, pay here car lot. About 4 years ago I quit making the payment cause I couldn’t afford it no more and was just gonna let them repo it. Well they never called, never sent a letter, never came and tried to repo it. They have my number, it hasn’t changed, they knew were I lived and I never tried to hide the vehicle. The registration is still sent to the court house every year and I go pick it up from there no problem. I have been pulled over in the truck since then and it didn’t come back stolen or anything like that. What do I do?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Patrick, in this case you might get to keep the vehicle. Sometimes lenders do not bother to repossess a vehicle if they do not feel it will be worth their time. The only thing that may get hurt is your credit report/credit score. But this is something you can build back up over time. To see your credit report go to annualcreditreport.com, and also check our credit score resource center: blog.readyforzero.com/resources/credit-score.

      • Patrick flowersPatrick

        How can I go about getting a title for it?

        • http://www.twitter.com/bwfeldman Benjamin Feldman

          I’m not sure if you’d be able to get the title, to be honest. But it may be worth doing some more research on this. Is there a particular reason you need the title?

          • Patrick flowers

            I’m wanting to sell the truck.

          • http://www.twitter.com/bwfeldman Benjamin Feldman

            If the lender still has the title, it will be hard to get it back. I’m not sure how that would work.

  • Tyler

    Hi I have a loan out in my name on a car that I don’t even have I was scammed into thinking it was a win – win situation and when the guy I did it for told me the vehicle was returned to the dealer and it will be taken out of my name all contact was lost and it turns out he had quit payment two months prior and the bank has called for a repossession order on a car I don’t have nor do I even know exists I thought it might be a scam when his numbers changed but I’m afraid to go to the police for fear I might be in trouble and I figure I will be stuck with the debt anyway. I made such a huge mistake and I’m scared to death should I let the repo action take course because both that and bankruptcy will destroy the credit I worked so hard for but I’m only twenty two and I have time to build it back up but even with bankruptcy I have to pay everything back eventually anyways don’t I?

    • Tyler

      Also the title of the vehicle must not be in my name because I didn’t get the paperwork to pay the taxes and tag fees when they came for my other cars.. the mans name is Jason Tywana Carter for anyone reading this please don’t make the same mistake I did.. I can’t even sleep at night

      • http://www.twitter.com/bwfeldman Benjamin Feldman

        Hi Tyler, I’m really sorry to hear about this situation. Your best bet may be to talk directly with the dealer or the lender (or both) and tell them what happened. They should help you figure out your options. It doesn’t seem like you should be legally liable for a car that was never yours. However, I don’t know all the details. I’d suggest making those calls and doing some research – and maybe even getting a free consultation with a bankruptcy lawyer. Stay positive and be proactive and maybe you can find a resolution to this mess! Good luck to you.

  • Tony Castro

    So my car got repoed for 2 late payment went to the lenders office gave them the money and fees and proof of work and address they said it takes 2 days does it really or are they adding more fees can they change their mind and make me pay more or the whole loan

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Tony, I don’t know what the rules are in that case, but I’d recommend waiting 2 days and then see if they will release the vehicle to you. Hopefully it all goes smoothly. If you have any follow-up questions, just let us know.

  • Summer

    I have a car the transmission is not working… I still owe 10,000 dollars.. I have not been able to work due to health isues.. And cant pay and anyways it doesnt work.. If i call and tell them to come and get it can the take me to court or suspend my license??

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      As far as I know, they cannot suspend your license for an unpaid debt. However, they usually would have the right to sue you to attempt to reclaim the unpaid debt. They don’t always decide to sue, though. I’d recommend researching the term “voluntary repossession” and then call the lender and try to work out the best possible outcome. Good luck!

  • Jen

    I bought a car the beginning of November. I never recieved a bill for the car but knew a payment was due on the 21st of December. So I called the company in December wondering where the bill was….they told me since we were in the middle of a bankruptcy they couldn’t legally send us a bill. Anyways, we decided to cancel the bankruptcy cause it was doing more harm then good, but yet we still never received a bill. Today, Feb 11, I got a call saying that we have to make the payments current or they will begin the process of repossessing it. Can a bank legally repossess a car if you never recieved a bill?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Jen, I’m not entirely sure what the laws are in that case. However, I would recommend getting current on your payments if possible. If not, maybe try calling the lender and see if they can work out a revised payment plan with you.

  • rose

    Hello! I bought a car 2 months ago and my dad is the co-owner, we had to do it that way because I was a 1st time car buyer and my credit was just building since i haven’t even been 2 years in this country, it was good but i didn’t qualify completely. I love and trust my dad completely of course by i had my doubts since my dad has a lot of debts, he got those years ago. Before I put him as a co-owner of the car I ask the dealership if there’s any way that any of the banks my dad has a debt with could take my car because of his debts, they told me NO. Is that true? or there’s a possibility that they might ended up doing that? I ask this because today I woke up and my car was gone, i thought somebody stole it, inmediately call the police and they told me that actually..the reason my car was missing is because the bank repossesed, I was shoked, the cop told me that it was because i was late on my montly payments, I couldn’t believe it because of the fact that I just made my first montly payment by the end of january! and my 2nd montly payment is due by the end of february (28 of this month)..and it’s only the 14!! so it’s not even due yet!!! Is there anyway they could make a mistake??!!! I can not believe it.

    Thanks.

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Rose, I’m sorry to hear about this situation – it sounds very frustrating. First of all, if you have made all your payments on time then the lender is not allowed to repossess the car. So I would recommend calling the lender and trying to figure out exactly what happened and why they took the car. If they seem to be operating in an illegal manner then you may need to pursue legal action to try to reclaim your vehicle. However, hopefully it won’t come to that. I would try to remain optimistic for now and see if you can sort things out with the lender. If you have further questions, feel free to ask us. And good luck!

  • Chris

    Hi, I’m currently 30 days late on my payments due to lack of work at the beginning of the year. Since then I’m back at work and am catching up on my bills. I am able to bring my note up to date on Saturday but I feel like I have exhausted all of my help from my lender. Please advise.

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Chris, I’m afraid I don’t understand your question. It sounds like you are going to be able to get current on your loan this Saturday, which is great. But I’m not sure what you mean about the help from the lender. If you could rephrase your question I’ll do my best to answer it! Sorry about that.

  • Chawntae

    I bought a car from a buy here pay here place. I asked the dealer point blank if anything was wrong with the car when I seen the service engine light on. He said no, just a faulty sensor with the light. Stupidity set in and I bought the car on payment plans. I find out now, 8 months later that the light is on due the catalytic converter, thermostat, cam and crank shaft are bad. It took them 6 months to replace the heater core that went out in the car, and I found when my tire went flat they didn’t give me a spare or doughnut. I’ve been told it’s illegal for them to sell me a car that had no extra tire, and im not sure how they legally got this passed with safety and emissions with those issues. Every time I call they tell me they’ll tack on the cost to the back of my (29%) loan. I can’t afford that. I can barely make the payments. What should I do?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Chawntae, I’m sorry to hear about this situation. It sounds like the dealer may have been engaged in fraudulent practices, especially if he knowingly sold you a car with mechanical defects while telling you the car was fine. You could see a lawyer and find out if you might have a legal case against him and his business. That would be one way to get back your money and get out of the loan. Other than that, you will probably have to deal with paying off the loan on your own – unless you want to give the car back, in which case you should research “voluntary repossession.” It might also be helpful to call the lender and see if you can work out a different payment plan.

  • Liz

    Hi,
    My boyfriend financed his car a few months ago. His parents, who have perfect credit, co-signed, because he just graduated college and is still building his credit.
    Unfortunately, since his computer broke, he has been making payments over the phone. Apparently his last payment did not go through, and he did not find out until two weeks later. He immediately made the payment, but has been freaking out because he thinks he ruined his parents credit as well as his own.
    Is this so? Based on your article, I doubt it. His lendor is through Chase. I told him to try to speak to a Chase representative, let them know he had tried to make a payment but it did not go through, etc.
    What can I tell him to ease his mind?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      If it was only two weeks, then there’s a good chance this incident has not damaged his credit score. However, I think your idea to call the lender and double check with them is a good one. They should be able to confirm that they received the payment and tell you if it will affect the credit score. You can also explain the situation and ask them not to report the late payment to the credit agencies. Good luck!

      • Bokshy

        How many days of you have to be behind in payments before they repossess your car?

        • http://www.twitter.com/bwfeldman Benjamin Feldman

          It’s up to the lender, but they are usually allowed to repossess as soon as you’ve missed one payment. However, that doesn’t mean they will repossess it immediately. If you are late on a payment it’s usually a good idea to call the lender and let them know what the situation is. You may be able to get an agreement to push one month’s payment onto the end of your loan term. Or you may be able to postpone repossession long enough to get current on your payments. Good luck!

  • jonny dingle

    I wondering if any one could help me I lost my job in December and I bought a car in June last year on finance and cant afford my full payments. I have contact my lender and I have told them my situation, I am now on jobseekers allowance but I also have a house to run and a credit card to pay. I offered to pay the half amount of my payments for my car until I was back on my feet but they refused and told my they could only accept the full amount that I agreed to pay when I bought the car. I am struggling as it is to pay any off my bills. I have had made many phone calls to them time and time again but I am not getting any where with them. I have now received a letter say that they are taking further action against me. could any one give me some advice thank you

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Jonny, one option in these kinds of situations is to do a “voluntary repossession” in which case you give the car back to the lender. This type of move can work but it’s not always the right path for everyone, so I’d recommend researching all the rules before you do something like this. If you decide not to do a voluntary repossession (or if you can’t) then your options are (1) to do your best to pay the loan and understand they may repossess the car anyway, (2) to keep trying to call and work out a different repayment plan with them, or (3) to find some other way to pay the loan such as getting a consolidation loan (if you have good credit) or looking for side jobs to make more money to pay the loan. Our resource centers might be helpful: blog.readyforzero.com/resources/. Best of luck to you!

  • djd

    I have a question I got a car load out only had it for about 6 months only made three car payments and decided it was to much car payment cannot afford the bank would send letter in the mail letting me know if I did not pay it they were going to pick it up then they call me asking where the car was so I tould them then they pick it up I was thinking it was over I was just going to have a repo on my credit now I got a letter in the mail saying they are taking me to count to sue me can I do jail time for this all the info you can give me will help very much
    thanks allot

  • Krish

    Hi there,
    I bought my car on March 2012 with 5years monthly payments agreement. Unfortunately I lost my that job where I was getting good pay, & now I start to work some where with very less salary that I even have problems for my rent sometime. What should I do? Is that ok to tell my dealer that I couldn’t afford your monthly payment anymore?Need you advice please,

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Krish, if you feel that you can’t pay your monthly payments anymore then you should contact your lender and see if you can do a voluntary repossession. Keep in mind that even if you do that, there will still likely be some amount of debt leftover that you’ll need to take care of. But call them up and see what is the best option for you.

  • Name

    Hello. We bought a van in 2008, defaulted on the loan in 2011. We still have possession of the van. We wanted to sell the van, of course needing the title – and in a better place financially. While looking over our credit report, the van is showing a $0 balance, and in the status column shows PD w/120+days. What does this all mean? And how can we settle the balance if it shows $0? How can we get a title? thank you for your response.

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi, that’s a very interesting question. I don’t know what that code means (“PD w/120+days”), but it seems to indicate the amount was more than 120 days late. However, I can’t fathom why it would show a zero balance on the account if it was never paid. You might need to call the lender to try to sort this out. Sorry I couldn’t be of more help!

  • justin frederick

    Hi me and my fiance just bought a car. From a used car lot. On my receipt it says that we have a grace period for the payment and if we pass the grace period we pay 5% interest on the payment amount. But when I called the dealer the guy said we couldn’t pay late and there was no late fees . they sold us a car witha possible bad tranny, a gas leak , gas meter is broken. We are trying to find a lawyer. But what do we do mean while? We got the car on 02/14/2014 and our payment isn’t do till 03/14/2014 but I won’t have it till 04/01/2014 thank you for your time

  • snuss

    Mother died just about one year ago and she had gotten a vechicle for me in her name so the loan was in her name. And the plates are in mine and there is no way I could get the loan into my name. She didn’t have no insurance or a will and I have made every payment on it even after she passed and the dealer told me to make payments still because I was always making them every month. But now they are saying that they are coming to get it if I don’t see a lawyer so told them to come for it and I want me payments back that came out of my account every month. Now what else could I do?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi, I’m really sorry to hear about your loss and about this difficult situation. I think if you have been making the payments as agreed upon in the contract, there doesn’t seem to be any reason why they should take the car. But I am not a lawyer, so I can’t really say for sure how to approach a situation like this. If you can find a lawyer or someone with experience in these kinds of cases, they can probably give you the best advice on how to proceed in order to keep the car. Good luck!

  • kyle mile

    wondering: i have a poop tonne of repayment on my transunion and assuming its on others yet it lists payments as lets say 50 (close but not revealing for all my specifics) and they say my total debt. but they dont say my total paid, isnt that a more valid comparison?
    Also, i paid back auto loan i think perfectly, and only owe 5000 in student loans and a couple hundo in misc from one lender. is there a specific lender or course of action that i would benefit from in terms of GETTING a car loan?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Kyle, the credit report should list your on-time payments that you’ve made, since those are part of your credit history. I’m not sure I understand your second question. If you’re wondering about which type of loan to get in order to buy a car, I would recommend looking for one with the lowest interest rates and without any hidden fees. Let us know if we can help further. And good luck.

  • Josh

    I was wondering if anyone would help me out with this situation. I bought a jeep feb 2013 and have always stayed punctual making the payments. December 2013 I lost my job due to personal reasons and was forced to move. its now March and i have missed every payment, December to present. i have not communicated with, and have ignored my lender since December. my old roommate told me they have a repossession order for the jeep and have hired a private investigator to find where it is parked. i know that is the worst thing i could have done but im this deep into it now. i was wondering what options i have, also is there anyway i would be able to keep the jeep?
    Sorry i forgot to say i am now back to work with a stable income, able to pay all my bills. even my auto loan. Am i too late to make any kind of different outcome on this repossession order? Another thing, while away from work i was in jail with no kind of income. will saying that help my case any, or just the obvious? “Damage my character” worse than i already have, pushing the lenders farther away from trusting the payments would ever be on time again? I love the jeep and want to keep it. Please, someone tell me there is a way it is possible. Thanks Josh

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Josh, sorry to hear about this difficult situation – it must be very frustrating. I can’t give out specific advice, but here is what I would say in general: whenever you are behind on your payments the lender has the right to repossess the car and often will do exactly that. One exception is when an agreement is made between the lender and borrower to postpone some payments until the end of the lease term (i.e. to be paid later). In a case where there has been no contact between the borrower and the lender and many payments have been missed, there is not a lot of hope for resolving the situation unless the loan can be made current. In other words, if the borrower pays everything that is owed (including all the missed payments) then the loan status could be changed back to “current” and the borrower could keep the vehicle. I hope this helps! And let us know if you have further questions.

  • Denise Rembert

    I am paying a car note but the car is not even good as a trade in because it will have negative equity. I can not afford to get it fixed and pay the car note so I would like to turn it back in to the bank. Is it possible?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Denise, I would recommend doing some research on “Voluntary Repossession” which basically refers to what you were talking about. Hopefully you’ll find some good resources online for how to go about doing that. Good luck!

  • rx8unknown

    If my account is charged off and my car is up for repossession. Am I still legal owner of the car as long as I am in possession of it?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      I’m not sure about this. I’d recommend doing a little sleuthing on Google. Also, if there is a more general question you have, feel free to reply here and I’ll do my best to answer it!

  • claudio

    i bought a car but i am not going to pay anymore i am on dissabily

  • Christina

    Hello, my parents are in their 60′s they sold their house and financed a motor home ( bus type) they have had it for 4yrs and have traveled to Alaska and other states(across the US). They filed for bankruptcy 3yrs ago but was able to keep the bus some how. Well now they can’t afford to travel (diesel is insane) so they were force to rent a house this winter. They can’t afford to keep the bus but still owe way more then it’s worth so no one will buy it. They have choose to just stop making payments on it so they can live. I’m wondering what will happen to them? And is it better if they tell the bank they can’t make the payment any more? It isn’t parked where they are living now…it’s actually in my side yard. So can I be held liable for it? Thank you for your time :)

  • jasmine

    hey my friend bought a car , at a buy here pay here dealership no credit check i put the car in my name cause she working on getting her lienses , can that harm me in anyway !

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Was there a loan attached the car purchase? If your name is on a loan, then yes, that can affect your credit report/score. However, if the car alone is in your name that shouldn’t affect your credit.

  • mischevious

    If I already have a financed car, can I finance another car and if the payments get to be to much can I take one of the cars back to the dealer?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Not as far as I know – unless you are prepared to deal with the consequences, which might include a lot of damage to your credit score and having to pay the difference between your outstanding loan balance and the value of the car you return to the dealer.

  • Fluffer Buttons, Jr.

    Hi there. I know someone that has not made a parent in 4 months, if not a little more… They most certainly will not be able to make full payments anymore. However, they are willing to make payments of a lesser amount – maybe 50%. 1st) Can I get in trouble if I let them park on my property? 2nd) Also, what is their best option at this point? Should they just cut their loses and go as long as possible till repossession? Or is there a way to work something out? They’re VERY hesitant about calling, obviously because they’re afraid of GPS/other forms of finding him. Thank you for the help!!

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi there, I’m not sure about the GPS thing so I can’t speak to that. However, the only way to find out whether there are any alternative repayment plans would be to call the lender, but if he/she is unwilling to do that then they won’t be able to find out about any such options. At the same time, I haven’t heard of any case where someone was allowed to pay 50% of their loan. It seems unlikely. But again, I can’t say for sure. Good luck!

  • esther m v

    I have a loan with this one company down south of California and I’m late just 10 days so now they are calling me threatening and harassing me saying that they are going to repo my car the next day if my payment is not in. My question is can they really do that?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      It really depends on the contract, but in many cases if you are in breach of contract (i.e. not paying as agreed) they have the right to take the car back. You could ask them for another option, such as moving the payment to the end of your loan term or asking for a deferment period.

      • esther m v

        They are not reasonable they are very rude but thanks for the heads up..

        • http://www.twitter.com/bwfeldman Benjamin Feldman

          Oh man, I’m sorry to hear that! We’ve heard from other people with similar situations. Best of luck! If you have a chance, take a look at our resource centers. They might help: blog.readyforzero.com/resources/.

  • Klee

    i just bought a car and it is a lemon and this my second month behind but is going to give them 800 the third month will i be in repossess

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi, sorry to hear about this situation! I would recommend researching “Lemon Laws” to see if you can return the car and get back your money: http://en.wikipedia.org/wiki/Lemon_law.

  • Maggie Thompson

    My husband bought a car from a dealer who financed through wells Fargo dealer services. He had no cosigner, and we didn’t make the payment on march 22. My sister in law got a call saying they were trying to find the car to repossess it. When I tried to call them back 10 minutes after she called me they didn’t answer and turns out their office is closed today. I’m freaking out, if I can get a payment to them will they still try to take it?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Maggie, if you can make all the payments and get current on the loan, then they would have no reason to repossess the vehicle. Best of luck to you!

  • betty

    Hi i just got a title loan through loanmax i lost my job right after and was put out of my home so i had to move I’m not able to make a payment this month and won’t be for another month I’m scated they will jail me i have a 1 year old baby to take care of. will i be jailed if i don’t make a payment or return there call??? Please help ease my mind.

  • Brittany

    I have a car that I got behind on. But the dealership has never gotten in contact with me . It’s been over 3 years since I’ve been behind. Have they forgotten about it?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      That’s interesting. They may have just decided that pursuing it is not worth their time. You should also double check to make sure you have not been missing any correspondence from them (i.e. letters going to the wrong address or something like that). If you’re curious, you can check your credit report to find out whether the unpaid debt is being reported. You can check it for free at http://www.annualcreditreport.com.

  • megan

    hi I’m having trouble paying my car payment and it seems as though my only option is to give the car back and get out from under it. what is the standard procedure when paying back the difference the the bank? I know they would sue me for the difference but what after that?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Megan, if you do a voluntary repossession the lender will probably work out the details with you for how to pay off the remainder of the loan. I’d suggest calling them up and talking to them so you can figure out the details. Good luck!

  • Renee

    I am curious if a bank would repo a car that only has an outstanding loan balance of $600 and the client has not been behind more than 30 days? I called to tell them I did make a payment online(29 days late) and she started asking me address, who drives the car, if it is usually parked at said address. It worries me now since I only have 2 payments left and the loan is paid in full that they would try to scare me now. I gave them the confirmation number I received and then called back to tell them the date of the next payment(but, it is past the due date as well). The 3rd agent I spoke to was much nicer and said that he saw I only had 2 payments left and would put a note in my acct. I am trying to get back on track with all the bills and once this is paid off I can breath easier. I have not had the best record paying but, have never gone 30 days as I am careful to try to avoid notification to the credit bureaus.

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Renee, I think technically they can repossess the car if you have broken the contract (i.e. not paid the amount as agreed). Usually they would not repossess if you are less than 30 days late, but since you are so close to paying off the loan in full, I’d do whatever you can to make sure you are up to date on your payments.