As our community looks ahead to the process of rebounding from the COVID-19 pandemic, many may find themselves behind on bills, like car payments.
If you're struggling to make payments on your vehicle because you've been recently laid off, the worst thing to do is to ignore the problem and hope it will resolve itself when the economy opens back up.
Missing a car payment damages your credit score.
Because we're in unprecedented times, with much of the American economy shut down due to COVID-19 concerns, many automakers and lenders are offering to let consumers defer payments while the pandemic persists.
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If you'd like to apply for such a program, be prepared to show documentation proving you were recently fired or laid off.
Under some deferred payment programs, interest rates will continue to accrue. So while the option buys you some time before you need to resume payments, you will end up paying more money for your vehicle in the long run.
In the worst case scenario, missing three car payments in a row typically triggers creditors to repossess your vehicle.
The consumer is usually liable for the remaining cost of the car, the missed payments, and also added fees like the cost of towing the vehicle and storing it in a secure lot.
In Wisconsin, the governor's administration ordered debt collectors to not harass people with overdue payments during the COVID-19 pandemic. But nothing in that directive suspended practices like vehicle repossession and collection of other collateral items.