 TITLE: How Cosigners Are Affected When a Car Is Repossessed CONTENT: How Does Auto Repossession Work?\n--------------------------------\nWhen a car is financed, the lender owns the vehicle until the loan is 100% paid off. The vehicle serves as collateral for the debt, and the lender can repossess it if the borrower falls behind on payments.\nThough some loan agreements allow repossession as soon as the borrower misses a bill, many lenders will try to collect payment for weeks or months before taking the next step. If that doesn't work—and the borrower fails to respond to notifications or make payments—the lender can, in most states, repossess the car without warning, and from almost anywhere. (A repossessor can't, however, commit a \"breach of the peace\" while doing so; if it does, the borrower may have legal recourse.)\nRepossession is really bad news for both the borrower and the cosigner. Not only will the borrower lose their mode of transportation, but one of you will likely have to pay the remaining balance, and credit scores belonging to both of you will take a hit in the process. Credit scores for both signers are also likely to be damaged by the late payments that lead up to a repossession as well. END