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My car broke down and I still owe the bank. What should I do?
I bought a used car a little over a year ago and I still owe the bank for it. Yesterday, the car broke down completely. It might not be salvageable at all. What should I do about the money that I owe the bank?
Liz Jenson · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
I’m sorry to hear that you’re having car troubles! When your car breaks down and you still owe money to the bank for the vehicle, you have a few options:
- Roll it over. You can add the debt from your old car to a new car loan and pay both cars off simultaneously.
- Pay off the loan. Depending on how much you owe the bank for your car, you might be able to pay off the loan and move forward from there. Then, you can sell the car and get a new loan—hopefully with a more reliable vehicle.
- Declare bankruptcy. While this isn’t an ideal solution, declaring Chapter 7 bankruptcy can help you get out of a tight financial spot.
In the meantime, you can save some money on car expenses by cutting down on your car insurance rates. This process is quick and easy when you use the
Jerry
app, where you can see a list of car insurance quotes that work for you in minutes. The average user saves $887 per year.View full answer
- Gregory R.
WHY YOU CAN TRUST JERRY
Jerry partners with more than 50 insurance companies, but our content is independently researched, written, and fact-checked by our team of editors and agents. We aren’t paid for reviews or other content.
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