Advice on Effects of Repossession

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sunil

Joined: 07 May 2009
sunil's page
Posts: 41

24 Magic Points

Subject: Advice on Effects of Repossession

Mon Jun 15, 2009 5:47 pm

my daughter and i co-signed for an auto loan. i am in the process of filing bankruptcy and she cant afford to pay it on her own. how will this affect her credit and what would be least impactful. voluntary repossession, reposession or include in bankruptcy filing.

scott

Joined: 28 Jun 2006
scott's page
Posts: 462

10934 Magic Points

Tue Jun 16, 2009 5:44 am

Hi sunil,

The default auto loan will be reflected on your daughter's credit report, as being due. After the car is repossessed, the creditor is likely to sell it off in an auction. Since you are filing for bankruptcy, the amount remaining after the car is sold off, must be paid by your daughter. Repossession will have a negative impact on her credit report and will lower her score. But she can try to rebuild her credit records by paying off any outstanding debts, other than the auto loan. I think she should also look for possible errors on her credit report, and dispute them.

A voluntary surrender of your car, I think would be a better option. Through a voluntary surrender you can avoid any costs that your creditor has to bear to employ a repossession agency. The debtors are generally required to repay the costs involved.
_________________
SCOTT

Use your credit account responsibly and enjoy a debt free life.

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