Keeping the auto repo man at bay |
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Steve Parrett of Nissan Motors Acceptance Corp. says Nissan often is willing to skip a payment and add it to the back end of the loan. No partial payment would be required, but the interest for any deferred payments would accrue. "In light of today's economic turbulence, NMAC is providing more customers with payment extensions than normal," Parrett says.
Meredith Libbey at Ford Motor Credit says contract extensions to qualified customers are its most common approach.
Chase Auto Finance also lists extensions first among the three most common solutions it uses, according to spokeswoman Mary Kay Bean. The other two are rewriting the contract when the borrower faces extenuating circumstances such as critical illness, and, in a few situations, settlements. This usually occurs when a customer finds a buyer willing to pay more than the vehicle's wholesale value but less than the amount owed Chase.
Rewriting the loan is the favored approach at BMW Financial Services, according to Martha McKinley who says, "The major tool would be to refinance, extend the term of the loan and lower the payments."
Mike Buckingham, president of the Hyundai Motor Finance Co., or HMFC, says they have gone as far as to work with dealers to get struggling borrowers out of their current vehicle and into a more affordable one, thereby lowering the monthly payment.
Any number of life changes can disrupt a borrower's ability to keep a vehicle loan current. Changes in employment, prolonged illness and natural disasters are the more common causes of loan delinquency, and the ones most often cited by vehicle finance companies. Regardless of the reason, a critical point is that the earlier a borrower contacts the creditor, the more likely an arrangement can be made.
According to the AFSA Vehicle Repossession Prevention publication, without customer contact, vehicle finance companies do not know whether a borrower is struggling or engaged in fraud. "Communicate with your lender openly, honestly and quickly," says Buckingham.
Even if the account is current but the borrower sees trouble on the horizon, Leach says, "Call your creditor. So many people are afraid to talk to their creditors. If the customer calls us without us looking for them, it makes a big difference."
Borrowers wishing to discuss their circumstances and possible solutions with their vehicle finance company should be able to find a contact number on their most recent statement. Below is the contact information for 16 high-volume auto lenders:
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