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Car Troubles

Many families rely on their own transport to get to work, school or conduct business.

So, if your car breaks down, it can throw your life into chaos. And repairs can be very expensive, so what can you do if you are in debt review and your car breaks down?

Never Just Miss Payments

Your debt review is a structured court ordered process.

The court order sets out how much you must pay each month.

If you just stop paying, it will result in all your credit providers starting new legal action against you. That could include the credit provider you owe for the car. They may even go get a judgment and be able to take your car and sell it on auction. 

So never just skip a payment. You could lose your car permanently.

Talk To Your Debt Counsellor

Step one in any financial crisis, while in debt review, is to talk to your Debt Counsellor immediately.

Give them all the facts and ask for advice.

Remember, they are not superheroes and cannot just automatically arrange for you to miss debt repayments because your situation has changed. But they will send information to all your credit providers and see what they are willing to do. Also, they may offer a solution you had not thought of.

Can You Wait?

You may not have thought of it, but it might actually be possible for you to wait to fix your vehicle.

You may be able to use a family member’s car, or catch lifts with family and friends for a few weeks. Alternatively, you may be able to adjust your schedule so much so that with sacrifices you can use public transport or limited rideshare lifts (like Uber).

It may involve waking up 2 hours early each day or skipping things and places you normally go (which is not convenient) but it can be possible. Do not be quick to dismiss this as an option.

This may allow you to arrange car repairs later, or organise with someone with skills you know to do them for you at a much lower price. Some mechanics may even allow you to pay a deposit and make small instalments later.

Research all the options before you rush to decide to skip a debt review repayment.

Catching Up

If your Debt Counsellor does make a proposal to your credit providers, and they are happy to allow you to repay less than normal (or skip a payment), then you may be able to repair the car soon. That is convenient but not guaranteed.

When negotiating such a convenient arrangement, your credit providers may demand that you make extra payments later to catch up.

That will require a restructure to your budget. You may have to really slash your expenses and simplify meals, electrical use, stop spending on clothing, extra school activities or more. You may have to use funds normally set aside for saving to make up the extra amount. If so, it will have a knock-on effect, and it could take you months or years to get things back to how they were.

Keep this in mind and be realistic. This may be what it takes to get your car back on the road now.

Don’t Rush To Fix It Only To Lose It Later

Having a car can be super convenient, if somewhat expensive.

With the cost of petrol, insurance, service, tyres and more, owning a car has both pros and cons.

If you are in debt review and have a sudden breakdown, we hope that you have some savings, a service plan or an uncle who is good at fixing engines.

If something like this happens it is always a good idea to talk to your Debt Counsellor. They can offer you realistic advice and help you decide on next steps to do repairs or asking credit providers for a chance to reduce your normal debt review repayment.

Whatever you do, don’t just skip a debt review repayment in your rush to get the car back on the road.