AA Missed Payment – Here’s What To Do

Are you worried because you’ve missed an AA car finance payment? You’re not alone. Every month, over 170,000 people visit our website seeking advice on debt solutions.

In this article, we’re going to explain:

•  A little bit about the AA
•  How you can spread your AA payments over several months
•  The possible legal repercussions of not paying AA
•  How the AA deals with missed payments
•  The impact of missed car payments on your credit score

StepChange stress the need for professional debt advice, noting that 60% of adults in financial trouble hesitate to seek help.¹

Missing a car finance payment can be a cause for concern — you might be afraid your car could be taken away or feel confused by your car finance contract. But don’t worry; we’re here to guide you through your options and find a solution that works for you.

Are there legal consequences for not paying AA?

If you realise that you can’t afford to pay your AA loan anymore, you should tell them immediately. In some situations, you might be able to negotiate an alternative payment plan. 

You may even be able to voluntarily surrender your car, depending on the type of contract that you have. If you are unsure, you can read your contract or contact your car finance company to find out. 

If you do nothing, you run the risk of your car being repossessed.

You will get a reminder after you miss the first payment. You may get a second reminder if you miss another payment or you can be sent a notice of arrears. This arrears notice will tell you how much you owe and when you need to pay it. 

If you do nothing and stay in arrears, your car finance company can send a default notice which will give you 14 days to pay off all the debt in full. If you don’t pay off the balance, your car agreement can be ended and your car repossessed.

The car finance company has the legal right to repossess your car if you don’t pay them back.

What to do if you can’t meet the payment

Contact AA support if you are struggling with your finances because your circumstances have changed. Next, contact a not-for-profit organisation for debt advice. When you ask for independent financial advice, things may not seem so bleak.

I’ve listed a few charities that provide free debt advice:

• Money Advice Service 
• Step Change Debt Charity
• PayPlan 
• Citizens Advice Bureau 
• National Debt Line 
• Money Advice Scotland

Getting advice and help rather than ignoring things will help you sort the problem out. Thus, the better the outcome will be. When you ignore a debt, things quickly escalate.

You incur late fees and other charges. You could be taken to court and be given a CCJ (country court judgement). It could ruin your credit history, and the CCJ will stay on your record for 6 years. Additionally, it’ll be visible to other lenders! This could affect your ability to borrow, get a loan or a credit card.

I recommend you don’t let the situation get to this stage. It’ll just lead to future hassles and financial headaches. Instead, stay in contact with AA support and try to work out directly with them. It’ll be worth your while!

How they deal with missed payments

Contact AA support as soon as possible when you struggle to pay bills and an insurance instalment. They could offer you several options which may get you out of a hole. But call them before the payment is due!

When you miss an AA payment, they try to get the payment from you 2 weeks later. When you pay by fortnightly direct debit instalments, they add the missed payment to the next one.

You’ll have to pay ‘reasonable’ costs and expenses the company incurs when you don’t pay. In addition, there will be late payment charges found in their Terms and Conditions!

What late fees does the AA charge?

When you don’t pay an AA instalment on time, you’ll have to pay £12 for each unpaid direct debit or failed attempt to recover the amount. In short, when you miss too many AA payments, the amount in late fees soon adds up!

Plus, you may have to pay interest on any default payments charged 29 days after receiving a Notice of Default Sums from the provider. On top of this, if the AA can’t get hold of you, they will refer your details to a ‘tracing Agent‘. You’ll be charged for this too.

Can I delay the payments?

No, you can’t delay any of your AA payments. The best way to resolve a payment issue is to contact the support team. You can discuss payment problems and ask for their advice. 

Whatever you do, don’t ignore the problem. A missed payment could be less manageable than if you default on it.

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Can I change my AA payment frequency?

You may be able to change how often you pay an AA instalment. However, you must call support first to find out if it’s possible. They’ll review your file and tell you whether they can change your payment frequency or not.

Will missed car payments affect my credit score?

Yes, missed car payments will affect your credit score.

This is because companies use your credit file to see if you are a ‘high-risk’ customer – someone who might have difficulty paying their bills on time. A history of missed payments will suggest to any potential creditor that you could have difficulty paying your debt off in the future.

You will look even less favourable to potential lenders if you have a repossession on your credit history. A repossession shows that you had such difficulty paying back your debt that someone had to go to court about it. Or that you had issues covering your bills so quickly that your car financer could just take it away.

Understandably, companies are going to be reluctant to give you credit!

After 6 years, it is no longer visible on your credit report, and you should find it easier to get credit again.

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Advertisement. MoneyNerd is a commercial introducer, not a debt adviser. The Debt Advice Service, a trading style of Pacific Financial Solutions Limited, offers free debt advice with no obligation. If you request an introduction, your details are shared with them so they can contact you.

Some debt solutions have fees and may negatively affect your credit rating. MoneyNerd may receive a fee if you proceed with a debt solution through The Debt Advice Service. MoneyHelper offers free, impartial money guidance and help finding free debt advice.

Will my details be sent to a debt collection agency?

Yes, when you default on an AA payment, your details are sent to a debt collection agency. The AA will instruct them to recover the amount you owe (debt). To avoid being contacted by a debt collector, stay in contact with the AA. Try to resolve the situation before it gets to this stage!

How to deal with a debt collection agency

If your debt is sent to a debt collection agency, don’t panic. Instead, stay calm and find out about your rights. Next, find out if the debt is yours before doing anything else. If you owe the money because you defaulted on AA payments, you’ll have to pay what you owe.

You have two choices. You can settle the outstanding about with:

• The debt collection agency
• Try to pay the AA directly

My advice is to prevent the situation from getting to the debt collection agency stage. It’s far easier to deal with the problem with the AA directly. When a debt collector sends out letters, they’ll ask you to pay the amount outstanding. If you ignore their letters, they’ll start visiting your home!

As mentioned, a debt collector cannot do certain things, which include:

• Force their way into your house
• Make you pay an amount you cannot afford
• Pretend they have some kind of legal authority

Be transparent and honest with a debt collection agency. It’s better to sort things out than ignore the situation, hoping it’ll go away!

The AA Contact Details

References

1. StepChange – Credit safety net report