Need Repossessions Removed From Your Credit Report?
A lot of people want to know if they can have repossessions removed from their credit reports. While there are several factors that need to be evaluated, the answer is yes, in some cases repossessions can be removed.
What is a repossession?
When you finance or lease a vehicle, your creditor or lessor has important rights that end once you’ve paid off your loan or lease obligation. These rights are established in the contract you signed. If you don’t make timely payments on the vehicle, your creditor may have the right to “repossess” — or take back your car without going to court or warning you in advance. In most cases, the creditor will be open to making payment arrangements so that a repossession doesn’t happen. It is important to note that if you are late on your vehicle payments, you should contact your creditor immediately to see if you can work out a payment plan with them.
Voluntary surrender vs. repossession
When you voluntarily surrender your car to the bank, the bank takes possession of the car and sells it to recover as much money as possible to put toward your outstanding loan balance. According to Experian, it’s slightly less drastic than repossession because rather than the bank sending someone to repossess your car, you willingly turn it over and at least know that the bank has the car rather than a car thief. When you do a voluntary surrender, your credit report will report “voluntary surrender” on the auto loan account. A voluntary repossession is still repossession. The biggest advantage to voluntary repossession is that your credit report will reflect that the creditor did not have to seize the vehicle from you, rather you voluntarily decided to give it to them. Another advantage to voluntary repossession is that you will incur less costs because the lender did not have to hire a repossession agent to locate and tow the vehicle from you.
Before considering the benefits of voluntarily surrendering your car, you should realize this is not a way to get out of repossession. When you take an auto loan, you use the car itself as collateral on the debt. If you default, the lender seizes the car to make up the difference. In a typical repossession, the lender will not tell you when or where it will take your car away. You will simply have the asset seized, usually at an inconvenient time. Voluntary repossession just means you have agreed to turn the asset in yourself at a given time to a given place. You have still defaulted on the loan. The derogatory mark will still remain on your credit report for up to seven years.
How can I get a repossession removed from my credit report?
Contact us! We have been able to negotiate with lenders and have them remove repossessions from many of our clients’ credit reports. A repossession is a terribly damaging mark on your credit. Contact us today to see if we can get it removed for you.