{"id":1866,"date":"2021-08-26T17:06:24","date_gmt":"2021-08-26T21:06:24","guid":{"rendered":"https:\/\/www.skypointfcu.com\/wph\/workarea\/?p=1866"},"modified":"2021-09-10T14:02:16","modified_gmt":"2021-09-10T18:02:16","slug":"car-payment-trouble-how-to-turn-it-around","status":"publish","type":"post","link":"https:\/\/www.skypointfcu.com\/wph\/workarea\/blog\/car-payment-trouble-how-to-turn-it-around\/","title":{"rendered":"Car Payment Trouble? How to Turn It Around"},"content":{"rendered":"\n

Your monthly car payment is not only a ticket to freedom, letting you enjoy summer road trips, but also a lifeline that gets the kids to school and you to work.<\/p>\n\n\n\n

But if it consumes too much of your budget, your ticket to ride could turn into a ticket to financial trouble. More than 7 million Americans were \u201cseriously delinquent,\u201d or over 90 days late, on their car payment at the end of 2018, according to the Federal Reserve Bank of New York. And 2.4% of loans transitioned into serious delinquency in the final quarter of 2018, up from 1.5% in 2012.<\/p>\n\n\n\n

If you\u2019re struggling with a car payment, dig into your budget and options. Then, take action.<\/p>\n\n\n\n

Understand your car budget<\/strong><\/h3>\n\n\n\n

\u201cThe first thing someone struggling with a car payment should do is reevaluate where their money is going,\u201d says Chicago financial coach Shanna Due.<\/p>\n\n\n\n

Car expenses go beyond your monthly loan payment. The total cost of ownership includes insurance, gas and regular maintenance. In general, aim to spend less than 10% of your take-home pay on your car loan and less than 15% to 20% of it on overall costs.<\/p>\n\n\n\n

Total up what you\u2019ve paid on all car-related costs over the past three months to get a clearer picture of your total ownership costs.<\/p>\n\n\n\n

Next, try to trim your auto expenses. Get insurance quotes to see if you can find similar coverage for less, and take on small repairs or maintenance tasks yourself. If needed, expand your cost-cutting<\/a> to the rest of your budget.<\/p>\n\n\n\n

\u201cOnce they\u2019ve reevaluated where they are [with their car budget], can they modify the rest of their expenses to make their car costs fit in,\u201d Due says. \u201cIf not, begin to look at an exit plan.\u201d<\/p>\n\n\n\n

Diagnose the problem<\/strong><\/h3>\n\n\n\n

Use what you learn about your car budget to understand your payment trouble: Was it a one-time blip or the sign of an unaffordable loan? You have a few remedies to get back on track if you\u2019ve just missed a payment or are a few months behind. Act fast to limit damage to your credit<\/a> and to avoid repossession<\/a>.<\/p>\n\n\n\n

It was a short-term issue:<\/strong><\/h4>\n\n\n\n