How to Stop a Title Loan Repossession
If you take out a loan and are unable to keep up with the payments, your lender may decide to take your car through a title loan repossession. While this can seem like an intimidating situation, there are certain steps you can take to protect yourself and possibly stop your vehicle from being taken.
Steps to Prevent Repossession:
- Negotiate with your lender: This is often the best way to avoid repossession. Your lender might be willing to modify the loan, such as extend the payment timeline, reduce the interest rate, or even forgive a portion of the loan. You can then avoid repossession and still get the loan paid.
- Refinance: You might be able to refinance the loan with a different lender which can give you a lower interest rate and longer repayment terms. Refinancing can help reduce your payments and make them more reasonable.
- Sell the vehicle: If you are unable to come to an agreement with your lender, you can sell the vehicle for cash. This way, you can pay off the loan and keep the difference.
- File for bankruptcy: This option is just a last resort and will not necessarily help you keep your vehicle. It can however provide you with a reprieve from repossession while matching the terms of bankruptcy.
Other Tips:
- Be sure to keep all communication between you and your lender in writing.
- If at all possible, keep paying the loan even if it’s not the full amount.
- If you are unable to come to an agreement with your lender and your repayment options have run out, it’s important to make sure that you talk to an attorney to help you with the legal process.
No one likes the thought of a repossession. But by following the steps given here and staying on top of your payments, you can hopefully stop a title loan repossession before it can happen.
What are some options to stop title loan repossession?
1. Negotiate a Lower Payment or Interest Rate: Contact the loan servicer and see if you can negotiate a lower payment or a lower interest rate. This could reduce the amount you have to pay, making it easier to continue making payments and stop the repossession process.
2. Refinance: Consider refinancing your title loan with another lender who may offer better terms. This will give you the opportunity to pay off your title loan and avoid repossession.
3. Seek Financial Assistance: You may be eligible for financial assistance programs that can help you pay off your title loan or provide other types of assistance. Contact a local social service provider to see if you qualify for any programs in your area.
4. Sell the Vehicle: If you own the vehicle outright, consider selling it to pay off the title loan. This may be the best solution if you can’t afford a refinance or other solution.
5. Declare Bankruptcy: Declaring bankruptcy may stop the repossession of your vehicle until your case is resolved. Speak to an experienced bankruptcy lawyer to see if this is the right solution for your financial situation.