Understanding Car Loan Reinstatement
If your vehicle has been repossessed due to missed payments, you may still have an opportunity to get it back through loan reinstatement. Reinstatement allows you to bring your loan current and resume ownership of your car.
Steps to Reinstate Your Car Loan
Check your loan agreement and state laws to confirm if reinstatement is an option for you.
Contact your lender immediately and request a written reinstatement quote.
The quote will detail the total amount needed to bring your loan current, including past due payments, late fees, and repossession costs.
Pay the full reinstatement amount within the specified timeframe, usually 10-15 days.
Once paid, your lender should return your vehicle and you can resume regular payments.
It’s crucial to act quickly, as your right to reinstate typically expires when the car is sold at auction.
What If I Can’t Afford Reinstatement?
If the reinstatement amount is too high, consider these alternatives:
• Negotiate with your lender for more favorable terms
• Explore refinancing options with a new lender
• Look into redeeming the vehicle by paying off the entire loan balance
Preventing Future Repossessions
To avoid going through this process again:
• Set up automatic payments
• Communicate with your lender if you anticipate payment difficulties
• Consider refinancing to lower your monthly payments if you’re struggling
Remember, reinstating your loan after repossession will still impact your credit score, but it’s generally less damaging than a completed repossession.