Hi,

I have a loan with State Farm Bank, I missed a payment back earlier this spring/summer due to a job loss. When rep called I explained I had lost my job and was told it would be noted on the system and I explained that I would send the next months payment in and they said they noted it on my file along with telling me that I had a few months to make up the missed pymt. Well I started getting calls and letters of interest being added to my payment the next month so I called and was told that even though I sent the payment I am still a payment behind and interest is accumulating, I was like duh I explained the reason why I didn' t make the payment and that I was told I had a few months to make it up.

Well I called and talked to a very nice rep one day and asked what my options are, she told me to try and refi if I couldn't to call back and check out other options. Do I really have any other options? Right now I am in a tough financial situation and would like to know if there is a hardship program or what options I have? If there are no options available I may need to just hand over the vehicle to the bank. If I do that how badly does that mess up my already terrible credit reports and how long will it be on there? Will it also mess up the possibility of me getting loans in the next 3-5 years if the rest of my credit and score gets fixed? I need help and info.. Thanks.

Or is there any recommendations of places I could try and get a refi with marginal credit??

You have more of a money management issue than auto financing related. YOU need to run the numbers and determine the possibility of making future timely payments along with making up the arreages.

(Not offered as destructive critiscism but general advice) If you make a phone call regarding the possibility of setting up a forebearance agreement - i.e. arrangements to make up back payments - then send a confirming letter to keep a good written trail.

You need to determine your future income stream in order to come up with a plan to make the loan payments. If you can convince the lender that you can make future payments on time then the lender is likely willing to work with you in order to avoid a repo. If you can't make future payments timely then you may need to find a plan to come up with the negative equity to dispose of the car to avoid a repo.

A voluntary repo for all practical purposes is as damaging as an involuntary repo and you may have less legal rights. In the auto financing business, the phrase is often "a repo is a repo" meaning that a voluntary is as damaging as an involuntary.

Thanks for the information. I have not gotten anything in witing from them other than showing the payment amount with the interest added. When I talked to them the first time I told them I have never missed a payment nor have they been past the final due date they are usually one to two days of the first due date. I will call them and see what can happen. I don't think I will miss this months payment but wanted more opinions on what to do. I have till into November to get it paid before its late. I am just thinking things way over. Thanks again.

one single late payment over a 2-3 year period of an auto loan is not self destructive.

I know but they sure make you feel bad about the one missed payment though. I will get it worked out it will just take time.