The effects of the coronavirus pandemic have been especially burdensome on auto loans borrowers.

Unlikestudent loansand mortgages, there are no government-backed relief programs to cover a monthly auto payment.

If you miss even one payment, and your lender technically can repossess your wheels.

A person gets their car put on a tow truck.

Car Repossession: What Can You Do Before, During and After?

How can your bank, credit union or leasing company possibly have the right to take back your vehicle?

Read your loan agreement.

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No Interest Til Almost 2027?

The efforts to repossess your car typically start after youve missed a couple of consecutive payments, he said.

Did you know?

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If youre in this situation, the time to act is now.

The fewer unanswered questions that your lender has, the more likely they are to attempt to cooperate.

Act very quickly, she said.

Because at that point, the loan has not been sent out to collections.

Theres no shame in saying… Thats where you drive the car to your lending institution and hand over the keys.

The difference between the two in terms of impact on your credit score is slight, McClary said.

What to Do if Your Car Has Been Repossessed

Your car has been repossessed.

Now how do you get it back?

So youll have to act fast if you want your car back.

You get your car back and resume paying your car loan.

The lender will sell the car, typically at auction, to get some of its money back.

Thats the amount youll be responsible for paying.

Your credit score will take a hit a big one.

I would put it on that scale of somewhere around bankruptcy or foreclosure, McClary said.

you’re free to climb out of this hole, but it will take some time.

Tiffany Wendeln Connors is a staff writer/editor at The Penny Hoarder.

Readher bio and other work here, then catch her on Twitter @TiffanyWendeln.

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