Job Loss and Deferring your Car LoanApr 7th, 2020
Job Loss? How to Qualify for Loan Default
With proper planning, the loss of a job doesn’t mean you have to default on your car loan. Although you don’t want to find yourself in this situation, there may come a time where you require some relief after a short-term financial hardship. Your Lender is there to help you.
Here is how one can qualify for a loan deferment:
First things first, reach out to your Lender. Don’t leave your Lender in the dark; tell them like it is, have open communication regarding your financial situation. Give your Lender an advancement in the notice, waiting until the last minute will not increase your chances of deferring your loan. Most importantly, don’t skip your payment, as this will result in affecting your credit score. Above all, don’t avoid the situation.
If your current vehicle payment isn’t working out for you, look into other options regarding your payments. Perhaps restructure your loan, look into special relief programs available from both federal and provincial. This can be reviewed with your lender.
Remember, your Lender is there to help you.
Qualifying for a car payment deferral:
You, as the lendee is exercising your option within your loan agreement to request a car loan deferment. The criteria for qualifying for a payment deferral can vary from Lender to Lender.
Depending on the Lender, if you have a history of making your payments on time, your Lender will most likely provide you with the temporary relief of a loan extension.
However, you may need to provide paperwork regarding evidence, i.e. a severance letter or an email from your boss proving that you are, in fact, in need of an extra hand.
Whereas some lenders don’t require any paperwork, all they need is a simple notice in advance regarding your next month’s car payment.
Keep in mind; a car payment deferral will only provide temporary relief of your financial situation as it does not postpone your payment.
A payment deferral may be just what you need, providing you with temporary relief after a short-term financial hardship until you can get back on your feet. Keep in mind; your Lender is there to help you. If you require a new car loan or are looking for a great deal on a new or pre-owned vehicle in the coming months Motor City Chrysler is here to help.