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I Can’t Afford My Car Payment | What Should I Do?

Tom Hartford, Senior Editor

April 3rd, 2020

Affected by COVID-19? Here are a few resources to help during this unprecedented situation.

CARES Act

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law to aid individuals and businesses impacted by the COVID-19 pandemic. This bill is the largest of its kind in U.S. history.

Direct Stimulus

Individuals will receive tax credits in the form of a check or direct deposit. No action is required to receive this benefit. This includes $1,200 per adult and $500 per child to individual filers earning less than $75,000 annually, along with other stipulations. Read more about the Coronavirus aid package here.

Unemployment Assistance

This CARES Act also includes expanded unemployment benefits. Requirements now include self-employed, independent contractors, gig economy workers, and more. To apply, contact your state unemployment office. Find their contact information on the U.S. Department of Labor website.

Mortgage Assistance

At this time, mortgage lenders and servicers can provide payment deferral of up to 180 days on federally backed loans. If needed, contact your mortgage provider to discuss deferring mortgage payments.

Rent Assistance

If you cannot pay rent, talk with your housing provider, as you may be protected under the CARES Act. Read more about COVID rent relief here.

You took out a car loan with big plans to pay it off in a matter of months. Then, life happened. Perhaps you found out you’re expecting another child or that your dream apartment opened up and you can move in soon. There’s just one catch: your expensive car payment is going to make it difficult to do it all.

 

So, you run the numbers but they still don’t add up. You just can’t afford your car anymore and are left wondering “How will I afford my car payment this month?” Let us help you out.

 

Contact Your Car Loan Lender

The first thing you should do if your financial situation is in trouble: contact your current lender. Ask if there are options to keep your car without going broke in the process. Asking about options before you miss multiple payments will likely open the door to a better scenario in the end. After all, like cell phone carriers, car lenders would rather make adjustments and keep a customer than go through the hassle of repossession.

 

What To Do When You Can’t Afford Your Car Payment

If you’ve been a faithful customer who has always paid on time, your lender will likely give you favorable choices. Your lender may let you modify payments in the short-term until you can afford them. You may even be able to defer payments for a time.

Once you are in a better financial situation, you would begin making regular payments again. In some situations, your lender may even offer you a new loan with a lower interest rate that would save you money in the long run and keep you in your automobile.

 

Refinance Your Auto Loan For a Lower Payment

Would a lower payment make your life easier? Consider refinancing for a lower monthly payment. However, this option is only available for those with a good credit score, as lenders are less likely to give better rates to people with bad credit reports.

If you have good or great credit, your lender’s willingness to refinance to a better interest rate depends upon a few factors, such as how long you’ve had the loan and the amount of the remaining loan. The age, mileage, and condition of your vehicle are also factors, as is the current market.

If the resell on your particular value plummeted after purchasing it, you may have a harder time refinancing for a lower interest rate and monthly payment, regardless of your credit score.

 

Get the Money Together

If money is tight, it may be a good idea to touch base with loved ones to find out if they can offer some help. If not, it may be time to consider borrowing money from a credit union or other finance company.

In the event a bank or other lending company is unwilling to work with you because of your credit or other issues, a personal loan is a great option.

With an Installment Loan from Check Into Cash, you can get quick cash to keep your car in your driveway without fear of repossession. These loans are only available in certain states, so check our Store Locator to see if you’re eligible.

 

Trade Your Car In For a More Affordable One

Sometimes, you bite off more car payment than you can chew. If you can afford a lower car payment, however, you may consider trading in your current vehicle for a new car or a new-to-you used car. This can make it immediately easier to make your monthly payments and reduce the risk of repossession.

In order to make the best trade in, you’ll need a vehicle with a high trade-in value. These are vehicles that have a high resell value and are more attractive to new and used car dealers.

Should you decide to trade in your vehicle, any loan amount you have paid on your current vehicle is counted toward the loan on your new car. Choose the right new or used car to purchase next, and you could enjoy a much lower monthly payment so you don’t struggle to make sure it is paid in the future.

 

Try To Find a Taker For The Vehicle Loan

If you don’t like your trade-in options, don’t give up hope. You may be able to sell your vehicle to a private party. If your loan amount is relatively low and almost paid off, you could actually come out on top with this option.

To do this, advertise your vehicle for sale and price it so you at least make enough money to pay off your loan balance. If your car or truck is particularly desirable, you can even make enough money to have some left over.

 

If All Else Fails, Find a Way To Make Your Car Payment

You’ve tried everything you can think of, and you don’t want your automobile to be repossessed. Family and friends want to help, but they’re strapped for cash right now as well. If this happens to you, don’t give up hope.

As mentioned above, an Installment Loan from Check Into Cash may be your best bet. These loans offer more money, with a longer payback period. This, in turn, will result in lesser payments over more time as compared to Payday Loans. This loan option is only available in certain areas, so Check In to your nearest store to see if you’re eligible.

With a quick trip to Check Into Cash, you may be able to access funds you need to make ends meet when you’re stretched thin. In just a few minutes, you can learn how much you’re eligible to receive and have the funds in hand immediately in-store or within one business day online.

Editor’s Note:

Due to the ongoing COVID-19 situation, your auto loan provider may make special accommodations during this unprecedented time.

Looking For Loan Options?

Your nearest Check Into Cash location is likely just around the corner. Drop by to say hello, learn about our loans, and take that first step toward your financial destination. Use the Store Locator below to find your nearest Check Into Cash storefront.

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