How to Negotiate Your Car Payment When Unemployed

Vehicle repossession doesn't always benefit creditors' interests and ranks as a last resort because of the considerable expense involved. When unemployment strikes and you find yourself struggling to make your car payments, make your plight known to the lender as soon as possible. Then, negotiate arrangements, such as deferment or extension, that allow you to continue ownership of the car and keep your loan-holder satisfied.

Instructions

1

Write down a list of payments you must make, such as your home mortgage or rent, utilities and food. Calculate how much money you have today and how much you expect within the next two weeks. This helps you understand the amount of money you have at your disposal for car payments.

2

Call your lender and explain your situation to a representative. Answer the representative's questions, such as the predicted duration of your financial difficulties and what amount you can pay toward the loan right now. If you plan to route your money to other expenses, tell the representative that you can't make the current payment due.

3

Ask the representative about an extension, which involves pushing back the payment from a few days to several weeks. Or ask about deferment of payments, when the lender tacks the payments onto the end of your loan, giving you some breathing room for a couple of months. During the extension or deferment phase, you can look for other employment or file for unemployment, or both.

4

Ask to modify the terms of your current loan if the amount of the payment prohibits you from paying it in full. If the lender extends your loan from 12 to 18 months, your monthly payment will drop.

5

Request that the lender waive any late charges incurred -- if applicable -- so you can avoid extra expenses.