Lower Your Car Payment
See what you can afford, where your lender may help, and when a smaller bill costs more.
Lower your car payment only with a plan you can afford.
First, work out what you can pay each month. Ask your lender about hardship help if the squeeze is temporary. If you need lasting relief, compare refinancing, but a longer loan can cost more overall. If neither path closes the gap, make a money plan before you miss another payment.
What changes when your car payment is too high
A later due date may help with timing, but it will not shrink a payment your budget cannot cover.
If you owe more than the car is worth, refinancing or selling it may be harder to use as a way out.
If the next payment is at risk, contact your lender now. Missed payments can harm credit and put the car at risk.
What you could realistically do next
Your current lender may offer a short break or a new due date while you get back on track.
What to check: Ask when payments resume and whether interest or missed payments will be added.
Best if: Best if your income can cover the usual payment again soon.
A reputable counselor can help you build a money plan and weigh keeping the car against selling it.
What to check: Check any counseling fees and whether the plan covers your car loan and other debts.
Best if: Best if the payment still will not fit after short-term help.
Combining other debts may free up room for the car payment, but it will not change your car loan.
What to check: Compare the new monthly payment, fees, and total cost with your current debts.
Best if: Best if other debt payments, rather than the car loan alone, cause the shortfall.
Check what your car payment needs to be
- 1Set an affordable amount
Confirm what you can pay each month after rent, food, insurance, and other bills.
- 2Find your loan balance
Check what you still owe, your next due date, and whether you are already behind.
- 3Estimate the car's value
Compare a realistic sale value with your loan balance before counting on refinancing or a sale.
- 4Test the timeline
Confirm whether the shortfall will end soon or you need a lower payment for the rest of the loan.
- 5Check any proposed change
Get the new payment schedule and total cost in writing before you agree.
These checks can narrow your choices, but they do not promise hardship help or refinance approval.
Compare the numbers that decide the path
Subtract what you can afford from your current payment. If the gap will last, a brief delay may not help enough.
Refinancing replaces your old loan with a new one. Compare the rate, fees, loan length, and total amount paid.
Compare your loan balance with the car's value. Selling the car will not erase any balance left after the sale.
A smaller bill now may cost more later
A hardship delay may give you time to catch up without changing lenders.
Interest may keep growing, and you may still owe the delayed payment later.
A longer refinance loan may lower what you owe each month.
You may pay more interest and owe more than the car is worth for longer.
Consolidating other debts may leave more room for the car payment.
Fees or a longer payoff could raise what you pay for those debts overall.
Good to know
How does refinancing a car loan work?+
A new loan pays off your current car loan, and you make payments on the new one. Compare the full cost, not just the monthly bill. A longer term may make each payment smaller while keeping you in debt longer.
Can I refinance my car loan if I'm behind?+
It may be harder to refinance while you are behind. Lenders may also limit options if your credit has weakened or you owe more than the car is worth. Ask your current lender about hardship help while you check what options are open.
Can credit counseling lower my car payment?+
A credit counselor cannot require your auto lender to lower the payment. A reputable counselor can help you check your budget, deal with other debts, and decide whether keeping the car is workable. Ask about fees before you sign up.
What if I sell my car for less than I owe?+
You still owe the balance left after the sale. Check your payoff amount and likely sale price before making a plan. Adding the leftover balance to another car loan could make the next payment harder to afford.
What if I cannot make my next car payment?+
Contact your lender before the due date if you can. Ask what hardship help is available and how it would affect interest and later payments. Missing payments can harm your credit and put the car at risk of repossession. Rules and timing vary by state and loan.