- Posted June 12, 2014 by
Stop Paying An Arm And A Leg For Your Car Loan
Negotiate With Your Creditors ASAP
Are you unable to pay your car bill due to a hardship such as a job loss, medical issues or bankruptcy? Lenders may be willing to renegotiate terms or lower monthly payments if you contact them and provide them with proof. Lenders aren't obligated to accommodate hardships but often they will because they would rather receive some form of payment than none at all. The key is to contact the lender as soon as possible; procrastinating will delay in late payments, negative marks on your credit and late payments.
If you have a solid credit score you may be able to refinance the car loan through another lender. Contact your personal bank or credit union and find out if they would be able to offer you a lower interest rate. Having a lower rate mean significant savings over time. Refinancing can be a good idea if your credit score is now higher than when you originally purchased your car. Make sure to order a copy of your credit report from Transunion, Equifax and Experian in order to ensure that your credit history is accurate prior to refinancing. Keep in mind that applying for credit repeatedly will decrease your score due to excessive inquiries so make sure not to apply at a large number of financial institutions at once.
Consolidating may not be the best solution for everyone but it's one more option to explore if you want to lower your car loan payments. Auto loans tend to have lower rates than consolidated loans. However, if you are currently paying higher interests rates on your other loans the difference may end up saving you money.