Repossession can result from two or three consecutive missed payments, which lowers your credit score. Additionally, some lenders have implemented technologies to remotely disable vehicles after even a single late payment. You can deal with a missing payment in a number of ways, and your lender will probably cooperate with you to find a solution.
The key to minimizing the harm is having an informed, honest dialogue with your lender, regardless of whether you just forgot to mail the payment or can’t afford the whole amount.
In This Article...
How far behind can my Kia loan be?
Your auto loan refinancing experience with Kia Motor Finance could feel overwhelming and intimidating. You wish to avoid a few dangers because you don’t refinance your Kia Motor Finance loan frequently, which is completely understandable.
Reasons you should not refinance
If your overall interest rate ends up being greater after refinancing your Kia Motor Finance auto loan, you shouldn’t do so. This means that if you wind up with a weaker financial product and a higher interest rate, you shouldn’t refinance your loan. Let’s look at the following illustration:
If your current monthly payment is $450 at 13 percent, you shouldn’t accept a loan at 13 percent even if the monthly payment is only $400 because your lender extended the loan’s term. Although it is undoubtedly conceivable, we strongly advise against it.
We’ve heard countless success stories from customers who successfully refinanced their Kia Motor Finance car loans. While maintaining the same loan period, several of our clients wished to lower their monthly Kia Motor Finance payment. Other clients extended the loan duration to 60, 72, and even 84 months in order to further minimize the monthly payments.
Other customers chose the cash-out loan from among all of our loan offerings because they had positive equity in their automobilethat is, the outstanding Kia Motor Finance loan sum was lower than the value of their car.
However, a common query we have from clients is, “I haven’t been fantastic at completing my payments therefore my credit score hasn’t really improved much yet. But I truly want to cut my payments each month. Should I refinance, accept a higher interest rate, and extend the loan’s term?
Such a refinancing is not one that we support. You’re committing yourself to much greater payments over a long period of time, which is a poor financial decision. Avoid being both a penny-wise and a pound-fool!
Can I skip a car payment?
Are you wondering if Kia Motor Finance will let you postpone a car payment since you’re strapped for cash? Yes, you are able to postpone one or more payments on your current auto loan. However, you must first discuss the deferral with Kia Motor Finance. Simply refusing to pay puts you at danger of collection calls and, eventually, a repossession.
Call Kia Motor Finance at 1-866-331-5632 and describe your position, if possible. The objective of Kia Motor Finance is for you to make your payments for the duration of the loan. You will ultimately pay more for your loan because finance charges will continue to be added to the outstanding debt. However, if you work successfully with Kia Motor Finance, they may postpone one or more installments as a courtesy and to assist you in making your payback.
Having said that, if you’ve been timely with your most recent payments, you may be able to refinance your Kia Motor Finance loan and lower your monthly payments. You may determine how low your payments could be in three easy steps without having to skip a payment or two.
Does Kia Motor Finance have a grace period?
The grace period for late payments under the Kia Motor Finance policy ranges from 7 to 15 days. Grace periods differ from lender to lender, and as a result of the coronavirus outbreak, banks are now much more understanding with their customers.
The minimum late fee we’ve seen was 5% of the monthly payment amount, although late rates vary greatly every loan. However, unless you have an emergency, we strongly advise against taking advantage of Kia Motor Finance’s grace period. You would be endangering your credit, which could have a long-lasting, detrimental effect on your personal finances.
Instead, we advise you to see if refinancing will lessen your monthly load and perhaps even generate unforeseen cost savings. Giving us your phone number and following our three easy steps will earn you a definite offer that is 100% online and won’t affect your credit.
How long does Kia Motor Finance take to repossess my car?
State-by-state variations in repossession laws range from three to five months after you ceased making payments on your Kia Motor Finance loan. What constitutes a default is specified in each unique retail and installment contract, the agreement you signed when you obtained your vehicle and Kia Motor Finance loan.
In some states and contracts, being in default for 45 days (or a month and a half) even results in a repossession. As soon as you stopped paying payments and as long as you haven’t paid the Kia Motor Finance late fees, you are in default.
You are still in default even if you make up all of your past-due payments and make Kia Motor Finance whole. To stop being seen as being in default, you truly need to pay Kia Motor Finance everything you owe, including fees.
How long till your automobile is repossessed?
You may very likely be in danger of having your automobile repossessed if you have been late on your car payment for 90 days or more, or if you anticipate being late. If you’ve never missed a payment previously, your lender might be more understanding; nevertheless, the more frequently you’ve been late in the past, the sooner they might try to retake possession of your property.
Can you skip a payment on a Kia Finance loan?
Additionally, the program Accelerate the Good has just added warranty extension. The Kia Promise warranty coverage extension program extends the deadline to June 30, 2020 for Kia customers whose warranties expire between March 2020 and May 2020 but who were unable to receive warranty-covered repairs because of COVID-19 (Coronavirus).
If I only make part of my loan payment, will my automobile still be mine?
Of course, if you pay less than what is owed, your automobile may be repossessed. While making partial payments may delay the time it takes the creditor to send out the tow trucks, ultimately you will lose your right to keep the car if you don’t pay what you owe. It doesn’t really matter why you can’t afford to pay. You cannot keep the car if you cannot afford the car loan.
You might be able to arrange a lower payment through a Chapter 13 bankruptcy plan, depending on your interest rate and loan’s length. You could keep the car if you did that. To make it work, though, you’ll need to find a reliable source of income.
Colorado’s state and federal courts both recognize Robert Salter as an attorney. This response is provided as general information only and does not establish a client-attorney relationship between any person and Robert Salter or Harkess & Salter LLC. To talk about the specifics of your legal difficulties, you should book a consultation with a lawyer.
If I have already paid more than half, can my car be taken away?
You are able to voluntarily discontinue your finance agreement[AN1] once you have paid at least half of the TAP. This entails returning the keys to the lender and ending the contract early with no further obligations.
The vehicle must meet the requirements for its age and mileage and be in good condition. Fair wear and tear is permissible with voluntary termination of a car loan, but the lender may charge you for anything above this.
If you find yourself with negative equity auto financing, this entitlement, which was included in the original agreement to safeguard you against car depreciation, can help you save a significant amount of money (owing more on the finance than the car is worth).
Nevertheless, you should be aware that a “Voluntary Termination” flag will be placed on your credit report. While lenders are not permitted to use this information adversely, they may limit the duration or request a deposit on future loans to assist prevent you from again reaching negative equity.
Can my car be repossessed if I have paid more than half?
According to the “thirds rule,” your auto finance repossession rights kick in once you’ve paid off more than half of your hire purchase loan. After that point, your lender is prohibited from taking your car without following the correct procedures. However, once you’ve paid half, you can take your car back to the dealership at any time.
What will occur if you forget to make a car payment?
Even though missing a car payment is not ideal, it might not be the end of the world. How many payments you’ve skipped truly determines how serious the matter is.
For illustration, suppose you neglect to pay your December auto payment while on vacation on a warm island during the winter. Your lender will probably be understanding if this is your first missed payment and you pay it a few days later. Because they are aware that you are only human, lenders won’t pursue you for missing one deadline, especially if you have previously been reliable.
If, however, you’ve skipped the previous five auto payments and haven’t been in touch with your lender, the situation is very different. Your lender is undoubtedly getting impatient at this point and is probably worried that you’re going to quit paying payments entirely.
If you skip one or more car payments, you can anticipate the following outcomes in any scenario:
You’ll hear from your lender
Your lender will get in touch with you as soon as your car payment is acknowledged as being “late” and inform you of the missed payment. Remember that each lender defines a late payment differently. If you miss the actual payment due, there may be a grace period incorporated into your vehicle loan contract that provides you a few extra days to complete the payment. However, after the grace period expires, your lender could tack on late payment penalties.
Your credit score could drop
Your loan’s grace period may be a lifesaver, but it usually only lasts a short while. Your lender may have to notify the major credit bureaus if your car loan payment is more than 30 days overdue. That implies that your credit score will drop a few points.
Making your auto payments on time is essential if you want to maintain a high credit score or are trying to raise it.
Your car might get repossessed
Your automobile will eventually be repossessed if you continue skipping car payments despite receiving notifications from your lender. Keep in mind that secured auto loans use your vehicle as collateral. This implies that if you fail to make the agreed-upon monthly payments, your lender has the entire legal right to reclaim your car. After all, until your loan is completely repaid, you don’t technically own the vehicle.
What occurs if I fail to make an auto loan payment?
Even one automobile payment missed can have a significant impact on your financial situation.
So, here’s what could happen if you fail to make a payment, make an overdraft when your repayment due comes around, or miss a payment during a difficult month because you wish to prioritize other expenses or debts:
- There may be a late payment fee.
- The lender will get in touch with you regarding the late payment (s).
- Your debt may accrue interest costs.
- A mark can be added to your credit report, and it might be there for at least six years.
- The lender has the right to seize your car if you consistently default on your loan payments. If you’ve paid back less than one-third of the total amount due, lenders won’t need a court order for this.
Read our guide to restoring your credit history for further details if your credit history has been negatively impacted.
What happens if your auto payment is a few days overdue?
You should be alright because car loan payments typically have a grace period. There shouldn’t be any late fines or effects on your credit, so I wouldn’t worry about them.
A week or two should pass during the grace period. You will then be charged a fee of about $30.
You will receive a mark on your credit report if your payment is one month overdue. The procedure of repossession will start some time after that.
Having saying that, each lender is unique. Call your lender if you are still concerned about any potential repercussions.
Make sure you’re getting the best bargain on your auto insurance to set aside some money in the future so you can stay ahead of your loan payments. Using the Jerry app, you can accomplish this rapidly. Jerry will evaluate more than 50 reputable insurers so you can be confident you’re getting the greatest coverage at the lowest cost.
How far behind must you be before being repossessed?
Generally, if you are in defaulttypically at least 90 days past due on a paymentmost lenders begin the repossession procedure.
How long will the car repo man search?
Once the repossession procedure has started, the repossession agent may take your car from your driveway, the parking lot at your place of employment, or even while you’re out shopping. Recovery organizations typically search for your car for up to 30 days.
One of the few places where a recovery company cannot remove your vehicle is in a locked garage, where some debtors try to keep their vehicles during the search. Additional strategies can include removing the license plate, parking farther away, leaving your car at a friend’s house, and so on. Sadly, repo businesses are aware of these evasion strategies.
The lender won’t give up even if you are able to hide your car from the organization that will repossess it.
In the event that the recovery business is unsuccessful in finding your vehicle, they notify the lender. Then, it’s likely that your lender will file a lawsuit. Your auto lender has the right to sue you in court and obtain a judgment for the return of the vehicle. If you refuse to turn over the car, you risk being accused of theft, which opens up a whole other set of problems.
It’s not advised to try to conceal your car from the firm handling the repossession. You can owe more money the longer the lender has to pay to keep the repo firm hunting. Additionally, be prepared to pay more expenses for the court proceedings if the lender brings you to trial.