What is a loan workout?: Auto Loan

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What is a loan workout?

A loan workout is a financial agreement between a borrower and a lender to modify the terms of an existing loan when the borrower is struggling to make payments. If you're wondering what is a loan workout? It’s essentially a way to avoid default or foreclosure by renegotiating loan terms. Common loan workout solutions include reducing the interest rate, extending the repayment period, or offering temporary payment relief. This is often used for mortgages but can apply to personal, auto.