Whether you’ve been involved in an accident, had a breakdown, or your car simply won’t start anymore, you might be very suddenly in the market for a new vehicle. And when that happens, you’re likely to find yourself in the middle of a very expensive crisis!
You’re on a budget, you can’t pull ‘new-car-money’ out of thin air, but you desperately need your own transport. What are you supposed to do next? Here are a few steps to look into.
Check Your Financial Entitlements
If the car has been totaled, and you’re no longer able to use it in any way, there’s a chance you could be due some compensation.
However, if you also have a loan remainder to pay off, this compensation will need to go towards that.
There are two things to do here:
- Check if your car insurance provider will pay out
If you have the right level of cover (a.k.a., you have a comprehensive plan), you shouldn’t have any problems with getting fair payment on the current market value of the vehicle.
This probably won’t be anywhere near as much as you bought it for, but it’s usually sizable enough to pay off at least half of any remaining payments you need to make.
And if you don’t have anything else left to pay, it’s simply a good bit of compensation!
- Check for GAP insurance
Did you buy your car on loan or lease? You may have GAP insurance. This covers the bridge between what your insurer pays and the value of the loan you might still need to pay off.
For some people, this ‘gap’ is incredibly hard to cover with just the first payout alone. So, if you took out GAP insurance when you first got your car, don’t forget to claim the payment you’re entitled to.
Look into Leasing and Loans
If you need to very suddenly buy a new car, it’s going to be hard to pay outright for one.
Even if you buy a car that’ll do just for the time being, that could cost you anything from $1000 to $5000. Most emergency funds don’t tend to be so generous!
As such, check out what leasing and loan options are available when you start looking for Cars for Sale. You’re likely to pay more in the long term, of course, but the monthly payments are smaller, and will be much more manageable over the next year or so.
Try to get pre approved
It’s always a good idea to get your loan sorted out before you go car shopping.
This means you have a definite budget to work with, as well as an idea of what your monthly repayments will be. That can help you to make a much more informed decision about what car will be the most affordable for you.
Suddenly need a new car? Talk to your insurer, pay off anything you owe, and space future payments out as much as possible.
Leave a Reply