The COVID-19 pandemic has made everyone’s current financial situation difficult that keeping up with bill payments, especially auto loans, becomes a bit more challenging. Fortunately, most lenders are understanding of the situation and are willing to accommodate to make auto loans less of a burden.
Why not prioritizing your car loan payments can be bad for you
According to Lincoln dealerships near Covington LA, it’s understandable why some people put car loan payments at the bottom of their list – there are simply too many essential needs to be paid first during these tough times.
However, skipping loan car payments can have negative impacts on your own financial health. Lincoln car dealers advise: if you have to prioritize bill payments, focus on rent, mortgage, utilities, child support, and auto loans. If you don’t have enough money to make a full payment, try speaking with your creditors to negotiate.
Seeking car loan relief during a pandemic
Nearly every automaker acknowledges the challenge and stress of keeping up with auto loan payments. Fortunately, lenders and leasing companies have created their own programs to give their customers some peace of mind. Most offer delayed or deferred payments with no late fees until the worst of the pandemic passes. Others also offer reduced payment just to keep the customer afloat. Lenders understand the situation and they know that if they don’t do their part to help by offering some leniency, the entire economy can fall apart.
Loan assistance programs mainly vary from lender to lender. They often differ on how to qualify, how long can you delay or defer a payment, and how all of these can affect your credit report.
For captive finance owned by automakers, the most common accommodation is loan deferment. A loan deferment is an agreement between the customer and the lender that allows payments to be delayed, essentially extending the actual deadline. Some automakers offer 60 days deferment, while others up to 120 days. One thing to note is that loan deferment is not equivalent to delinquency, so your credit score should not be affected.
Lincoln dealerships around Covington, LA preferred to handle requests on a case-to-case basis. You should contact them directly to explore your loan payment options.
Downsizing is not only applicable to people, but with cars as well. You can talk to your lender if downsizing is a far better option for you than a loan deferment. This is especially true if you are looking at a rather large monthly payment.
If that doesn’t work, you can try refinancing your car loan to reduce the monthly payments and save you from large interest rates. The only requirement for this to work is if you have a good credit history and you still have a source of income. Otherwise, you might not qualify for refinancing.
Want to know more about beneficial car loans during the pandemic and how you can get some relief? Check out Baldwin Lincoln car dealer in the New Orleans, LA area for more details.