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Can I Extend an Expensive Car Loan in Acton?

Can I Extend an Expensive Car Loan in Acton?

We’re tackling a customer question again today, this time around car loan terms. The question was ‘Can I extend an expensive Acton car loan? I’m having trouble making ends meet and want to lower my monthly payments.’


We asked our Acton auto loans team to explain whether you can extend an expensive car loan or not and what to do if you’re struggling to make the payments.


Extending auto loans


First things first, can you extend an auto loan? Not usually, no.


A loan is a fixed agreement for a fixed amount for a fixed period of time. While many loans have the option to overpay if you want to, few have the option to extend the term of the auto loan.


The only exception to this is if you’re facing hardship. Many lenders will work with you to extend the term of the loan to make it more affordable.


This is only usually in genuine hardship situations though.


If you’re facing this situation, discuss it with your lender before you miss a payment to ensure your credit score remains intact and to maintain the goodwill between you and your lender.


Refinancing your Acton auto loan


Refinancing is the main way you can change the terms of your car loan.


Lenders will contemplate changing the terms in genuine hardship situations to help you avoid defaulting, but otherwise it’s a fixed contract.


If you’re not facing hardship or are borderline, your best option is to refinance the loan.


This basically means applying for a new loan for a new amount and a new term. As long as your situation and your credit score can support the new loan application, this is your best bet.


The alternatives are to sell the car or get money from elsewhere. Neither of which are ideal depending on your situation.


To refinance an auto loan, do the following:


  1. Check your credit score to make sure it’s sufficient
  2. Get a settlement figure from your current lender so you know how much you owe
  3. Work out how much your car is worth and how much equity you have in it
  4. Research loans, loan terms, interest rates and work out what works for you
  5. Contact one of our Acton car loan team so we can help


We strongly recommend exploring refinancing options before you miss a payment or get into financial trouble.


Wait too long or until you miss a payment and your credit score could take a hit, your credit report could show a missed payment and the whole situation changes.


Neither of us wants that!


While it won’t prevent you from refinancing, it may make it more difficult to find a good deal and may make it more expensive, which is the last thing we need!


If you need help or advice on anything to do with auto loans in Acton, contact Car Nation Canada today, we can help!


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