 TITLE: How Does Repossession Work? CONTENT: How Long Does a Repossession Stay on Your Credit?\n-------------------------------------------------\nRepossessions are considered derogatory marks and typically remain in your credit file for seven years from the date you stopped paying your loan. Repossessions—like bankruptcies and collection accounts—are red flags in credit reports and can have a serious impact on your scores.\nIn addition to the repossession being listed in your credit report, failing to pay your auto loan on time may trigger other negative marks in your credit. For each month you are 30 or more days past due, the lender can report the account as delinquent. And if the account was sent to a collection agency, a record of the collection account may also appear in your reports.\nOn its own, a repossession can cause your score to plummet. Combined with the additional negative dings, a repossession could cause years-long damage to your credit that may hamper your borrowing abilities in the future.\nFinally, it's important to remember that even after a repossession, you may owe what's called a deficiency balance. This is any loan amount left over after a lender liquidates your collateral (in this case, usually by selling your car at auction). If your outstanding loan balance is more than the lender is able to get for your car, you will be on the hook for the remaining amount. END