By Christine Anderson Ferraris
Hi folks, this month we’re offering a few general tips on how to manage when you are unable to make payments on a large expenditure, such as a new or used car, truck or recreation vehicle. The following tips are some suggestions to consider on how to proactively avoid repossession. If you have any questions about the information below, contact our office and we will try to assist. Be well and keep safe!
Contact your Lender Promptly – If you are concerned about missing a payment, you should contact your lender as soon as possible. Many banks, manufacturer lenders and other creditors have emergency relief programs to help borrowers impacted by COVID-19. Borrowers who communicate early and honestly with their lenders thereby demonstrate good faith efforts and a responsible lender will work with you to keep your account in good standing. IMPORTANT: Make sure to get any new agreement in writing and communicate by email or, the old fashion way, by mail with the lender. Be sure to keep all communications (and track delivery if communicating by mail) in case, later, you need to remind the lender what was agreed upon.
Monitor credit reports – Consumers who enter a program or reach an agreement with their lender should monitor their credit reports to ensure their loans are not being reported as past due or delinquent. Currently, you can check your credit report history weekly without a fee at www.annualcreditreport.com; this is generally the best place to get a free credit report from Experian, TransUnion and Equifax. You should get all three since you may find different reporting on each one – and make sure you dispute any errors!
Sell, if it makes sense – Selling before a repossession takes place may be an option. Generally, a vehicle will sell for a better price than at a repossession sale and the consumer will not have to pay the creditor’s fees and expenses that they must pay if a vehicle is repossessed. Avoiding a repossession will also likely be better for your credit score/history. Be mindful that if you sell your vehicle, you should use the money received from the sale to pay back the creditor. We suggest trying to negotiate or having a professional, such as debt counselor or bankruptcy attorney, assist you. You may be able to negotiate for a lower amount if you can make a large final payment.
Watch out for loan modification scams! – When looking for refinancing options, be wary of loan modification scams. The Federal Trade Commission warns that there are plenty of fraudsters who claim (for a fee!) they can negotiate with a consumer’s lender and lower their payments. The scammer generally will seek to collect their fees and never actually follow through. Avoid believing bold promises, talk with your lender first and please, do your research online before entering into any agreements!
Talk to a credit counselor –Loan modification scams aside, it is possible to find a good credit counselor to develop personalized plans to address financial challenges. The Federal Trade Commission’s website has helpful information on choosing a credit counselor at https://www.consumer.ftc.gov/articles/0153-choosing-credit-counselor.
The information provided does not, and is not intended to, constitute legal advice; instead, all information is for general informational purposes only. Information may not constitute the most up-to-date information. Links are only for the convenience of the reader, A. Ferraris Law, PLLC and its members do not endorse the contents of the third-party references.
Christine Anderson Ferraris and her firm, A. Ferraris Law, assist consumers and business owners harmed by the government, or another business. She has been for several years the race director for the CV50/50 children’s trail run in Colossal Cave Mountain Park each November.
A Few Tips to Avoid Repossession
By Christine Anderson Ferraris
Hi folks, this month we’re offering a few general tips on how to manage when you are unable to make payments on a large expenditure, such as a new or used car, truck or recreation vehicle. The following tips are some suggestions to consider on how to proactively avoid repossession. If you have any questions about the information below, contact our office and we will try to assist. Be well and keep safe!
Contact your Lender Promptly – If you are concerned about missing a payment, you should contact your lender as soon as possible. Many banks, manufacturer lenders and other creditors have emergency relief programs to help borrowers impacted by COVID-19. Borrowers who communicate early and honestly with their lenders thereby demonstrate good faith efforts and a responsible lender will work with you to keep your account in good standing. IMPORTANT: Make sure to get any new agreement in writing and communicate by email or, the old fashion way, by mail with the lender. Be sure to keep all communications (and track delivery if communicating by mail) in case, later, you need to remind the lender what was agreed upon.
Monitor credit reports – Consumers who enter a program or reach an agreement with their lender should monitor their credit reports to ensure their loans are not being reported as past due or delinquent. Currently, you can check your credit report history weekly without a fee at www.annualcreditreport.com; this is generally the best place to get a free credit report from Experian, TransUnion and Equifax. You should get all three since you may find different reporting on each one – and make sure you dispute any errors!
Sell, if it makes sense – Selling before a repossession takes place may be an option. Generally, a vehicle will sell for a better price than at a repossession sale and the consumer will not have to pay the creditor’s fees and expenses that they must pay if a vehicle is repossessed. Avoiding a repossession will also likely be better for your credit score/history. Be mindful that if you sell your vehicle, you should use the money received from the sale to pay back the creditor. We suggest trying to negotiate or having a professional, such as debt counselor or bankruptcy attorney, assist you. You may be able to negotiate for a lower amount if you can make a large final payment.
Watch out for loan modification scams! – When looking for refinancing options, be wary of loan modification scams. The Federal Trade Commission warns that there are plenty of fraudsters who claim (for a fee!) they can negotiate with a consumer’s lender and lower their payments. The scammer generally will seek to collect their fees and never actually follow through. Avoid believing bold promises, talk with your lender first and please, do your research online before entering into any agreements!
Talk to a credit counselor –Loan modification scams aside, it is possible to find a good credit counselor to develop personalized plans to address financial challenges. The Federal Trade Commission’s website has helpful information on choosing a credit counselor at https://www.consumer.ftc.gov/articles/0153-choosing-credit-counselor.
The information provided does not, and is not intended to, constitute legal advice; instead, all information is for general informational purposes only. Information may not constitute the most up-to-date information. Links are only for the convenience of the reader, A. Ferraris Law, PLLC and its members do not endorse the contents of the third-party references.
Christine Anderson Ferraris and her firm, A. Ferraris Law, assist consumers and business owners harmed by the government, or another business. She has been for several years the race director for the CV50/50 children’s trail run in Colossal Cave Mountain Park each November.
