{"id":99,"date":"2017-05-30T12:00:00","date_gmt":"2017-05-30T12:00:00","guid":{"rendered":"http:\/\/www.consumerslaw.com\/blog\/are-you-haunted-repossession-your-credit-report\/"},"modified":"2023-03-27T14:38:25","modified_gmt":"2023-03-27T18:38:25","slug":"are-you-haunted-repossession-your-credit-report","status":"publish","type":"post","link":"https:\/\/www.consumerslaw.com\/blog\/are-you-haunted-repossession-your-credit-report\/","title":{"rendered":"Are You Haunted by a Repossession on Your Credit Report?"},"content":{"rendered":"

\"\"Just when you think you’re getting your finances in order and want to apply for a new line of credit, a vehicle repossession<\/a> from long ago can come back to bite you. What happens after your vehicle is repossessed, and how does it affect your credit report and credit score moving forward?<\/p>\n

What happens after the sale of your car?<\/h2>\n

1) Collection<\/h3>\n

Once the lender sells a repossessed vehicle, you’ll receive a letter that includes the vehicle’s sale price and any remaining balance owed on the loan. This letter is called a deficiency notice<\/a>.<\/p>\n

The lender may proceed with collection of the deficient balance through their collection department. However, the lender will often assign the collection of any deficient balance to a debt collector<\/a>, and the borrower will begin to receive calls and\/or letters from them.<\/p>\n

Whether you owe the deficient balance or not, collectors must follow the Fair Debt Collection Practices Act when they contact you about debt. Borrowers have rights, whether the balance is owed or not.<\/p>\n

2) Lawsuit<\/h3>\n

After a period of time, the lender may choose to file a lawsuit against the borrower for the deficient balance. If the lawsuit is ignored by the consumer, a default judgment will be entered against the consumer.<\/p>\n

Judgments can be dangerous! Bank accounts can be attached. Wages can be garnished. Property can be seized. Judgments can be listed on the consumer\u2019s credit reports and impact the ability to be approved for new credit.<\/p>\n

If you have been sued<\/a>, contact a qualified consumer protection attorney to discuss your rights.<\/p>\n

3) Credit Reporting<\/h3>\n

Vehicle repossessions negatively affect your credit report and lower your credit score. They can remain on your report for seven and a half\u00a0years after the original delinquency date. The negative reporting could impact existing accounts by increasing interest rates or decreasing credit limits. The repossession could also affect your ability to be approved for new credit, whether you\u2019re applying for a new credit card, car loan, or mortgage.<\/p>\n

Negative credit information may also impact your ability to be promoted or hired for a new job or get approved as a tenant for an apartment. The Fair Credit Reporting Act<\/a> offers consumer protection for the accuracy, fairness, and privacy of reported information. You can get a FREE<\/a> credit report every twelve months from Transunion, Experian, and Equifax.<\/p>\n

Steps to take<\/h2>\n

If you are haunted by\u00a0negative reporting from a vehicle repossession, take the following steps:<\/p>\n