How long does a repo stay on your credit report?
Who doesn’t love driving and enjoying the shining four-wheel of your choice? However, you never know when the time changes and you are not able to pay your EMI on time. The result is nothing but the undesired repossession of your loved car. It is better to first be capable enough to be able to pay your car loans and installments on time and then opt for it. Repossession can have the worst effects on your credit score.
As per the reports from various experts, auto repossessions stay on your credit report for almost seven years. The impact can reduce over time, but it has a very negative impact on your credit report. Your account with repossession record is being removed if you have not taken any steps to improve your credit score. However, if you are able to pay all the dues, your account will be back as the current account and your record would be maintained as an account history. After 7 years, you will be able to gain back all the benefits with the credit card.
Let us know the Impacts of the repo on your credit card and is there any way in which you can get it removed?
Impact of Auto Repossession on your Credit Card
If your car has been repossessed, your liability doesn’t end here. You will have to pay the additional amount in case your car is sold at a lower amount than your liability at the auction.
You can even buy back your repossessed car at the auction if you have arranged the cash by the time auction is planned.
In most of the cases getting back, the repossessed car is not possible for the owner, but if he can arrange the cash, he can pay the repossession fees and get the car back.
If you have any intuition about not being able to pay your installments on time, it is better to talk to your auto loan lender and try to get the additional time for your support. Meanwhile, try to gather the amount required to pay your auto loans. The finance companies can even extend your loan repayment period to help you through the financial hardships. Repossession in most of the cases is a loss to the financial companies too, and this is that thing they want to bring into practice. They can guide you with some of the alternatives. Try to face the problem rather than avoiding it.
Steps to be taken to rebuild your repo on your credit report
You just cannot stop with your bad credit score. All you can do is get a secured credit card from your finance company and keep paying your pending loans and credits on time. It is surely going to help you improve your credit score.
Your credit will take time to get repaired, but slowly and gradually, it will. The time for Repo to stay on your credit card is quite long. You cannot wait for so long to stay away from purchasing a car, but at the same time, the truth is the same finance company after the repossession of your car is not going to support you with any kind of loan. Thus, what you can do is, approach another finance company who is ready to provide you with a loan in spite of knowing about your repo record.
You can buy a car and get the credit approved by another company. However, these companies provide you with a loan at a much higher interest loan. It is just because they are providing you with a loan at a risk as per your past record. If you take a new auto loan and make the payments on time, it is certainly going to help you repair your past credit records.
If you have maintained an expected record for the seven years time and you have no pending dues, the Experian will delete your account from the credit report and you don’t have to forward any kind of request for doing the same.
If you are not sure about when your seven years period would be completed and you are unaware about the current status of your account, you can request your free annual report anytime. You can either seek it offline from the office or you can even check it online.
Whenever you seek any kind of loan be it an auto loan, home loan or any other loan. that can be a huge sum of money you have to make sure you have an income source that gives you savings apart from fulfilling your daily needs and clearing your debts. Also, an additional income source apart from your regular income source would be helpful. Having a repo on your credit record is not recommended considering future aspects.