Bad things happen to good people. Sometimes members are faced with unemployment, salary reductions or cut hours, downturns in the economy that lead to drops in home values, or even 401(k) losses. When this happens, it's not long before bills start piling up. But they don't have to.
If you're faced with difficulties making your loan payments, R-G may have options to help reduce some of the stress and get you back on track.
Contact us right away. What many members don't realize is that it's in their best interest to communicate that they're having trouble making their loan payments, rather than avoiding them. We of course need to get paid and want to keep you as a member in good standing, so we are often willing to work out a repayment plan that is fits your new situation.
Restructure loan terms. Based on your payment history, the reason(s) why you can't pay, your credit score or other factors, we may let you to defer your payment for 30-60 days. We may also be able to offer to refinance your existing loan. Depending on the current rates, you may actually lower your interest rate if you refinance. We may also be able to stretch the term of the loan to lower your payments.
Sell your vehicle. Selling your vehicle and paying off the loan is also an option if the value is close to what you owe. If you can't afford the vehicle anymore, selling it and finding something less expensive that works with your new budget.
Avoid having your auto repossessed. It's usually best to sell your car to get the most value, and then pay off the loan. Some members who can't make payments decide to voluntarily return their vehicle to us. This is called a "voluntary repossession" and will negatively affect your credit score. While this is better than just ignoring your payments and causing a physical or "involuntary repossession", you will still owe us the difference between the balance of your loan and what we can sell the vehicle for at auction, which will likely be less than if you sold it yourself. However, with a voluntary repossession, there will be far fewer fees than a physical repossession.
MORTGAGE LOANs and lines of credit
It's always best to understand your mortgage loan. Knowing what kind of loan you have—variable rate, fixed rate or a combination of both—can help you determine your options. Contact us if you are unsure. If you have a variable rate mortgage product and your payments are going to increase, you may be able to refinance to a fixed rate mortgage. If you're planning on moving soon, be sure to weigh the added expenses associated with a refinance.
Determine your options. If you can't make your payment, contact us, even if your request has been turned down before. We need to know why your payments are delinquent. Is it temporary? What has changed in your life? How much equity do you have? Do you want to keep the home? What payment amount will work for you? It's better to be proactive and find a solution before you get so far behind you can't catch up.
Prevent Foreclosure. Losing your home through foreclosure has long-lasting effects on your credit and ability to buy another home in the future. If you've fallen behind on your payments, it's extremely important to discuss foreclosure prevention options with us. If your problem is temporary, We might be able to modify the terms of your loan, or refinance the balance to lower your payments. This obviously doesn't work if you are in a home you can't afford. If your situation is not temporary, you'll need to consider selling your home to avoid foreclosure and the credit problems it can bring.
CREDIT CARDS and other loans
Make the minimum payment. If you can, always make the minimum payment on your credit card and other personal loans to avoid late fees, and dings on your credit report. Try to avoid charging large amounts on your card if you can't pay it off every month. If you can't make the minimum payment, contact us before missing the payment to discuss your options. Let us know your situation and if this is a one-time issue, or if your ability to repay has changed. We may be able to offer an extension and/or waive the late fee. Communication is key. Simply avoiding the payment is the last thing you should do.
Find another source for the money. If you own your home and have equity (the value exceeds your mortgage balance), you may be able to obtain a home equity loan or line of credit. Home equity rates are much lower than credit card rates, so you'll be able to pay off your higher-interest debt faster. If this isn't an option, a personal loan may suit you better than a credit card and the temptation to continue spending. Zero-percent interest credit card balance transfer promotions are tempting, but could come back to haunt you if you don't pay the balance off before the promotion expires. As a last resort, sometimes members turn to friends, family, or their employers to help with the funds needed to get back on track. Friends and family won't report negatively on your credit, and can often be more flexible on when the money needs to be paid back.
Get help. Credit card debt can get out of hand in a hurry. If you have other cards in addition to your R-G Visa, to help reduce debt, contact a credit counseling service, such as the National Foundation for Credit Counseling (NFCC) a non-profit organization that offers money management advice and solutions to your current financial problems. They can help consolidate debt, create a budget and possibly negotiate lower rates on your behalf.
If you are having trouble making your R-G account payments, please call us at 866-852-6478.