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If You Can’t Make Your Car Payment During The Virus Shutdown

By Cathy Moran

 

car payments coronavirus

How am I going to keep my wheels while the coronavirus looms?

The fight against the coronavirus has cut off income for millions.  While there’s been broad discussion about mortgages and student loans,  there’s less discussion about rent.

So far, I’ve heard no governmental discussion about how to proceed if you can’t make car payments.

Car loans present particular, prickly problems, distinct from home mortgages and student loans:  the car creditor has a lien and the right to repossess the car if you don’t pay.

The closing of the courts and the lack of paychecks to garnish, which limit other creditors, doesn’t protect the car buyer.

And, there’s no governmental protection (yet) from repossession.

Hurray for Edmonds

Edmonds has assembled information on the announced policy of a long list of car lenders.

Check it out.

As of this writing, their page is dated March 17, with a promise to update it as time goes on.

Universal best practices

Anytime that you’re told to “contact your creditor” during this crisis, don’t rely solely on the phone.

The phone is easy, but I have no confidence in the ability of the lender to track those phone calls or retrieve them when necessary.

Follow up every phone call with a short, written letter, identifying yourself and your loan number, along with the meat of your message.

Keep a copy.

We don’t know how governmental and institutional policies will develop, but you want to be able to prove that you reached out as requested.

What’s to come

What’s different in the coronavirus crisis from other financial downturns is that the pain is huge and widespread.

Creditors and the government will have to develop mitigation strategies that preserve people’s mobility and make it worthwhile to keep paying on existing loans.

We’ll just have to stand by to see what they are.

My expectation is that lenders do not want to repossess a fleet of cars, and they don’t want to further tank their cash flow.

And, where I am, the repo guys are quarantined too.

More as news develops.

When you can’t pay your bills because of the virus

Protections for California homeowners during times of pandemic

California renters get protection from eviction

Tax season postponed

 

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Filed Under: Consumer Rights Tagged With: 2020

About Cathy Moran

I'm a veteran bankruptcy lawyer and consumer advocate in California's Silicon Valley. I write, teach, and speak in the hopes of expanding understanding of how bankruptcy can make life better in a family's future.

Bankruptcy Basics

About The Soapbox

You’ve arrived at the Bankruptcy Soapbox, a resource of bankruptcy information and consumer law.

Soapbox is a companion site to Bankruptcy in Brief, where I try to be largely explanatory and even handed (Note I said “try”).

Here, I allow myself to tell stories and express strong opinions. We dig deeper into how to consider bankruptcy and navigate a bankruptcy case.

Moran Law Group
Bankruptcy specialists for individuals and small businesses in the San Francisco Bay Area

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