How to Get Approval for an Auto Loan Extension

If you want to extend the term of your auto loan, you must ask your lender to modify your loan. Otherwise, applying for a completely different loan than the one you already have is known as refinancing. Many lenders are willing to work with borrowers to extend an auto loan because of financial hardship, but may restrict your options. Extending your loan term may also increase your interest rate and your overall loan payback amount. While you'll still obtain a lower monthly payment, you may want to plan on refinancing in the future if your rate increases significantly.

Instructions

1

Call your auto loan provider to speak to a bank representative. If you're behind on your car payments, you'll likely need to speak to your lender's retention or collection's department.

2

Ask your lender if you can modify your current car loan and extend your term. Your lender may choose to do this only under circumstances of financial hardship; many lenders offer loan extensions to distressed borrowers. Discuss your situation in detail to find out if you qualify.

3

Make a note of any documents your lenders asks you to provide, such as an unemployment statement or proof of disability. Give your credit information if asked, as your lender may require you to resubmit a credit application. Your lender may also ask you to submit additional forms before approving your loan application.

4

Bring your forms to your lender or email or fax the forms promptly if your lender is not local. Once your lender receives your paperwork, it will make its decision to extend your loan term. If your lender agrees to a loan extension, discuss your new monthly payment amount, term and interest rate.

5

Sign your new loan contract. Read the contract over thoroughly to ensure your loan terms are as you previously discussed. Return the contract promptly if your lender isn't local.