Can You Defer a Car Payment?

If you find yourself in a situation where you are behind on your finances, you may be wondering if you can defer a car payment. The answer is yes. So, the next thing you’ll want to know is: How do you set up a payment deferment on a car loan? The finance team at Westbrook Honda is here to fill you in on deferring a car loan payment.

Making a Payment Deferment on a Car Loan

What is a payment deferment on a car loan? It is simply asking your lender to skip a monthly payment. Securing a payment deferment will help you avoid having your vehicle repossessed for missing a payment. Some auto loans offered in the New London area have built-in deferment policies, but it is best to speak directly with your loan provider to get their approval.

Make sure that you are open and honest with your lender when asking to defer a car payment. It is important that they can have a clear understanding of your current financial situation. Some lenders may only approve one deferment, or they may approve multiple deferments depending on their policies and your current situation. Note that even though you defer a car loan payment, you may still be required to pay interest.

Reasons to Defer a Car Payment

Before deciding to defer a car payment, you should make sure to explore all of your available options, such as asking your Middletown-area family and friends for help. However, if it becomes apparent that your best choice is to defer a car payment, take the following pros and cons into consideration.

Pros

• When you defer a car payment, you can prevent having your vehicle repossessed. This will allow you to keep your vehicle while preventing any damage to your credit score.
• By deferring a car payment, you will avoid any substantial late charges.
• Deferring a car payment can provide some extra time to sell your vehicle if it still has some remaining equity.
• If you defer a car payment, you will also have some extra time to refinance your auto loan. You can easily apply for financing online at Westbrook Honda.

Cons

• When you defer a payment, you’ll still have to cover that cost at a later date.
• As mentioned, some lenders may require you to pay the interest for the month in question, even if you don’t make the payment.
• The loan still accrues interest if you defer payment for a month. This could mean that you will end up paying more interest in the long run.

Find Flexible Auto Finance Options Today at Westbrook Honda

Can you defer a car payment? It will depend on your lender, so it is important that you contact them to get all of the details. The finance experts at Westbrook Honda can walk you through your options and help you determine a payment plan that is best suited to your budget while helping you understand secured loans. If you have any questions or would like more information on whether you can negotiate a lease buyout or whether to opt for an extended warranty, please don’t hesitate to contact us.