When Is Your Car Loan in Default?
Your car loan is considered in default when you fail to meet the terms outlined in your financing agreement. While every contract is different, here are the most common situations that can trigger default:
?? Missed Payments
The most common reason. In many cases, missing one payment can technically place the loan in default — even if the lender waits before taking action.
?? Repeated Late Payments
Consistently paying late or allowing payments to stack up can also trigger default under your contract terms.
?? No Insurance Coverage
Full coverage insurance is required and if you let it lapse, that alone can place your loan in default.
?? Breaking Contract Terms
Providing false information, moving the vehicle out of state without notice (if restricted), or failing to maintain the vehicle can also violate your agreement.
What Happens After Default?
Once a loan is in default, the lender may:
The safest approach is to communicate early if you’re having trouble making payments. If you’re financing through Canino Auto Sales, reaching out before your account becomes severely past due can help you explore possible solutions.
Staying current protects your credit — and your vehicle.
