Your auto loan refinancing experience with Kia Motor Finance could feel overwhelming and intimidating. That’s totally understandable, you don’t refinance your Kia Motor Finance loan every day and therefore want to avoid a few pitfalls:
In This Article...
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.
What occurs if a car payment is missed, Kia?
Your auto loan will go into default if you repeatedly skip payments. As a result, you’ll start receiving calls from collection agencies, your credit score will suffer, and eventually your car may be repossessed.
Here’s the issue, I suppose
The loan provider also does not want you to miss payments on your loan. A repossessed car would be much more preferable to them than the money they are owing. Call your dealership to try and work out a payment plan if you have defaulted on your auto loan or believe you are in danger of doing so. Almost always, a situation can be made.
How many days may your auto payment be late?
Vehicle Loan Grace Period Depending on the lender, grace periods for auto loans might vary, but most banks grant a 10-day grace period before considering a payment to be overdue. After then, there will probably be a late fee.
With Kia Finance, is it possible to miss a payment?
FAQs about Loan Deferment You will be able to skip the payments that would have typically been due throughout the agreed deferment period if Kia Motors Finance approves your request for a payment deferral on your account. Although interest will continue to build up as usual, there won’t be any late payment penalties assessed.
How do I alter the due date for my Kia loan?
Working out a new vehicle loan due date requires communication, just like it would with any other lender. Contact Kia Motors’ Finance division by calling (866) 331-5632.
What happens if you’re two days late with your auto payment?
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.
What happens if your first automobile payment is late?
Your automobile will be repossessed by the lender if you don’t make your first payment on time and your loan falls into default. You currently have a few choices. By paying the total of your late payment, late fees, and the lender’s costs associated with reclaiming the car, you might be able to reinstate the loan.
Can I make up my four-day late auto payment?
If your payment is received after the grace period has passed, you can be assessed a late fee. Normally, auto lenders hold off on reporting your late payment to the credit bureaus for 30 days after your payment is due.
Will a two-day payment delay impact my credit score?
Once you’ve missed a payment on one of your invoices and it has been at least 30 days since the due date, the late payment may be reported to the credit bureaus. Even if you pay a day late, penalties or fines can apply; however, if you catch up with your payments before the 30-day grace period, the late payment won’t harm your credit.
If I make one late payment, will my automobile be repossessed?
Normally, if someone has a car through a financing arrangement, they won’t actually own it until the last payment has been made. It continues to be the financial company’s property.
The car might then be repossessed if they later fall behind on their payments.
Can car payments be suspended?
In the case of a car loan deferral, the lender consents to allow you to make a smaller payment or no payment at all for one, two, or possibly three months with the understanding that you can resume your usual payment plan after the deferment is through.
Deferments are not permitted by all vehicle lenders, and those that do have various requests processes. Your loan arrangement may occasionally include a deferment provision (in which case you might see a “skip a payment” option on the webpage where you make your payments or a “skip payment” slip in your payment coupon book). Other lenders demand that you produce a hardship letter, in which you detail your need for the deferment and your plans to resume regular payments.
Your lender may request extra financial information in addition to the hardship letter (similar to what they likely requested when you applied for the loan), and they may also check your credit score and credit report. The lender can decide not to grant you a deferment if your credit score has drastically reduced since you obtained your auto loan, or if your income or assets have decreased. If the lender approves the deferment, it will send you a forbearance agreement to sign, which will serve as a contract outlining when you will begin making your normal payments and outlining any fines or penalties you will incur as a result of the arrangement.
A deferment may allow you to completely forgo your payment or it may require a smaller payment that merely covers the interest portion of your subsequent scheduled payment. Any skipped or lowered payments will be added to the end of your repayment period in either case, and interest will continue to accrue on the loan during those additional months. As a result, you’ll have to make significantly larger payments than the sum of each deferred payment before your loan is repaid. A deferment is everything but a free pass because you’ll probably be charged a fee for each missed payment.
Will putting off a car payment damage my credit?
Deferments, or pay periods where you skip some or all of your payments, are permitted under many auto loans. This only means that you are permitted to postpone paying that debt till later, not that you don’t still owe it. Deferments are utilized in crises when you have either a sudden, unanticipated cost or an unforeseen temporary decline in your income. For instance, it would be wise to ask for a deferment if you were temporarily laid off from work or if storm damage necessitated urgent house repairs.
Your credit score is not harmed by deferments. Since you prearranged it with your lender, a postponed payment counts as “paid according to agreement,” as opposed to just missing or paying it late. That’s particularly crucial if you’re already experiencing the kind of emergency that necessitates a delay.
What occurs when a payment is postponed?
Deferred payment arrangements are not loans. For your loans, you can postpone payments, though. Right, it’s confusing.
Deferred payments are choices for interest-free payments that let you or your clients make a purchase today and pay in full later. As a result, someone who postpones a $500 payment will only pay $500 when it is finally due.
Customers typically pay interest on top of their regular repayments when taking out loans (i.e., the principal). Lenders could also tack on finance fees. Therefore, when it comes time to return the loan, a borrower may end up paying more than $500.
For instance, if you borrow $1,000 at 0% interest, the finance charge will be $50. As a result, instead of $1,000, your total postponed payments now total $1,050 ($1,000 + $50).
Loan payment deferrals
Lenders occasionally permit you to postpone loan payments for particular circumstances, such as COVID-19 or temporary adversity. Even if you delay payments, interest may still build up on your loans, increasing the overall cost of the loan.
If you need to postpone loan payments for whatever reason, check with your bank or lender.