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How long will the deficiency amount owed after a repossession settlement on a motorcycle show up on your credit report and is there any way to get rid of it?

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2015-07-15 18:49:51
2015-07-15 18:49:51

get an attorney to contact them with nasty letters

I contacted an attorney and was told that there is nothing we can do. The company is reporting this settlement as a charge off, which is apparently the worst thing to have on your credit report. This is really ruining our lifes. We were even denied car insurance because of it. Any ideas to how to go about dealing with this or what our rights are would be a great help.

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First off you will be required to pay the repossession fees unless you voluntarily turned the car in. Secondly you will be required to pay the deficiency. The deficiency is the difference in the amount the lender sells the car for and the amount you owe. Let's say you owe $10,000 and they sell the car for $8,000. That leaves you owing the lender $2,000. Thirdly this repossession will be placed on your credit report and will stay there for 7 years. Repossession should be the last resort after you have talked to the lender and done all you can to avoid this. Sell the car to another individual even if you have to sell it for less than it is worth, then pay the lender the deficiency out of your pocket to avoid repossession. Have someone take over the payments. Whatever it takes to avoid this.

A repossession is a significant derogatory mark against your credit. The account appear with a similar status as any collection or charge off account. In repossession, the collateral is often re-sold with the amount received being applied against any remaining amount owing on your loan. If the collateral is sold for less than what you owed, the amount left over, called a "deficiency balance" is still your debt. The creditor can actively collect on this, report it on your credit report and sue you to recover the amount.

Yes, the lender can file suit for the outstanding amount and if they receive a judgment they can execute the judgment in the manner in which the laws of the judgment debtor's state allow.

That is a repossession. Anytime the lender get's the car back instead of the money agreed to on the contract, it's a repossession. It will show as a voluntary repossession. And hurts the credit. Doing it does not relieve you of any deficiency between the amount the car gets sold by the bank for and the amount you owe. However, you would save many of the costs that the bank would have to expend, (fee's, towing, etc.,) that would become part of the amount you owe (hence make that possible deficiency bigger) in a "normal" repossesion. It is definately better, ABSOLUTELY ALWAYS, to co-operate, even work with the lender if you cannot make payments and would end up with an involuntary repossession. And when you do this "possession in lieu of forced repossession", you may be able to get them to agree to any number of things: Perhaps even waiving any deficiency; very possibly along with allowing you some time to sell it yourself - which is cheaper to all than having to have a broker and such involved, and can get substantially more for the car than it being sold in a bankers wholesale auction.

Yes, you owe the difference of the amount of the loan and what the vehicle was sold for plus any costs of the repossession. You are expected to pay that amount.

There is no set limit on the amount that can be charged for a repossession.

Sometimes yes. In some situations, such as default on a loan, the lender will take into consideration that something is better than nothing or less than the settlement amount. In cases where the vehicle is or soon will be up for repossession, the lender may feel it is better to settle for a lesser amount, than to go through the trouble to send the account for repossession, and conversion of the collateral, as well as attempting to secure the additional fees that come with and follow repossession actions.

Contact the lender and make arrangements to pay the outstanding balance. You may be able to pay only the past due amount. Once this is done, they will likely release the repossession agency to let you claim it. Keep in mind that you may have to pay storage fees to the repossession company before you can take your property back.

The amount you will owe the creditor will be the amount of your auto loan (including repossession fees, interest, and collection charges) minus the amount the vehicle sold for at auction. The creditor will notify you of the amount due in writing after they auction off the vehicle.

After a repossession, you will need to pay a fine usually. For example, if this was a car being repossessed, you would have to pay a certain amount to get it back.

Yes, but you have a very limited amount of time to do it in.

Some states have set maximum amounts for repossession fees. The state of Texas,. however has not set a maximum amount on the fee that can be charged for a car repossession.

Relief of debt is a form of income, they have given you $4,000 to do anything you want (usually past tense) with. As such, the IRS is going to want their share of your good fortune. Not much you can do about that. Consult with a tax consultant for ways to ease the burden.

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If they have a deficiency judgement, generally because the repossession did not develop enough money to fully pay them the amount you owed, that amount is still your debt and responsibility. Like any creditor, liening assets you have is one of many methoids of collection or assuring payment they have.

Recovery Requirements: Self help repossessions permitted as long as there is no breach of the peace. Deficiency balence: deficiencies and suit is permitted regardless of loan balance,deficiency amount, or time limit from date of repossession to date of sale, to date of suit. Redemption, Creditor may demand loan balance plus expenses. the state allows the debitor 10 days to redeem with the balance. License plates are to remain with the vehicle, custom plates stay with the owner. repossession agency's are required to be licensed.... Contact the Oregon State Attorney General's Office or you could probably also contact a repossession agency in Oregon, just don't tell them you are a debtor. http://landru.leg.state.or.us/ors/ RECOVERY REQUIREMENT: As per UCC, repossession allowed without committing a breach of the peace.

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Actually, it doesn't just come off your record. It will show as a repossession, but it will show as no balance due.

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If the debt is paid in full, it will "look" better then a partial settlement. aA more important issue is that in a settlement, the difference in the amount owed and the settlement amount is taxable.

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Pay the past due amount on the loan or pay the loan in full. In the event you are able to do this, it is a good idea to have the lender contact the repossession agency to cancel the repossession while you remain on hold. If you fail to do this, it could take several hours for them to notify the repossession agency, and your vehicle could still be taken.

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