Can I Return the Car if I Can’t Pay My Monthly Car Payments?


You can return your car if you can’t make your payments — known as voluntary repossession — but doing so can destroy your credit rating. Your bank may be able to help you if you can’t make payments. Also, you may be able to sell your vehicle instead.

Consider all of your options and the effect that repossession will have on your credit before you decide to return your vehicle.

Monthly Car Payments


Payment Deferment Option

Call your bank as you soon as you know you can’t make your payment. Your lender may work with you to help you keep your vehicle. As long as you have a good payment history, the bank might allow you to defer your payments.

A deferment allows you to miss up to several months of payments without penalty. You can use the time to get your finances back on track or pursue other options, such as selling the car.


Selling Your Vehicle

Try to sell your vehicle, if possible. As long as your loan balance and vehicle equity are in line with one another, you can sell your car. If you owe less than the car is worth, you can keep the profit you make from your sale.

Ask your lender for the car’s payoff amount and check its private-sale value using an appraisal guide, such as the one offered at or the Kelley Blue Book website, to see if the option is worthwhile. If your value is lower than the loan balance, you must come up with the difference to satisfy the loan.


Refinancing the Loan

If your inability to pay has not affected your credit history, refinancing your loan may prove an option. To refinance, you must apply for your loan’s balance amount to another lender. If your approved interest rate is lower, you can enjoy a lower monthly payment.

Refinancing may offer an opportunity to extend your loan term, which also lowers your monthly payment. If approved for a refinance, you likely have 30 to 45 days until your next payment.


Bringing the Vehicle Back

If all other avenues fail, you can return your vehicle. Call your lender to find out where to return it. Avoid an involuntary repossession, meaning the bank will hire a repossession company to collect your car. If this happens, your car can be taken from anywhere, even from your place of employment. Repossession should be your last resort.

A repossessed vehicle is later resold by your lender, and you are still responsible for any money still due on the loan after the sale. If you don’t pay it, the lender will likely pursue legal action.



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