What Does It Mean To Default On A Car Loan

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, - May 27, 2016

Simply put, to default on a car loan, you have failed to repay the loan, and the bank or other financial institution takes back the vehicle. A default usually occurs when you fail to make three or more payments in a row. This has a devastating effect on your credit. In this situation, it is better to work with the bank's credit department to find a payment level at which you can recover your vehicle and keep a default off your record. Most times, a bank will work with you to help keep a default from occurring. They may suggest budget counseling as well as working out a new payment schedule that works with your income.

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