How to Get a Repo Off Your Credit: 7 Effective Removal Tips

When you’re late on payments or stop making payments on a loan, the lender can repossess or “repo” the item you’re financing to settle your debt.

Knowing how to get a repo off your credit report can help you boost your score and minimize the impact of those negative items on your credit score. Let’s take a closer look at how to remove repossessions from your report.

Table of contents:

Step 1: Understand What Repossession is
Step 2. Review Your Credit Report
Step 3. Dispute Inaccuracies
Step 4. Negotiate with Lender
Step 5. Consider debt settlement
Step 6. Wait for the Repossession to Age Off
Step 7: Legal Help and Financial Counseling

1: Understanding Repossession

Repossession is the process of a lender taking possession of an item you financed. This could be a car, home, furniture, or similar products. When you fail to make payments on time or stop making payments altogether, the lender may demand that you surrender the item. They take possession and use the item to settle your loan debts.

There are two types of repossession:

Voluntary repossession: This happens when a borrower willingly surrenders the item they financed to get out of having to continue making payments on the loan. The owner typically gets to choose when the lender takes possession of the item. If you know you will be in a rough financial situation, you can initiate a voluntary repossession with no late payments.

This repossession allows the lender to take possession of the asset even if you’re current on your payments. It’ll still hurt your credit score, but some lenders may see voluntary repos more favorably and may still be willing to lend you money.

Involuntary repossession: This type of repossession happens when a lender takes possession of the item the borrower financed without the borrower’s permission or cooperation. The owner doesn’t get to choose when the lender takes possession of the item, and that possession could happen at any time.

Borrowers may see a 100-200 point change in their credit score for involuntary repossession on credit reports.

Both voluntary and involuntary repossessions will have the same impact on your credit score. They show that you effectively defaulted on the loan, which can cause your score to drop. It can take seven years to get a repossession off your credit report. After seven years, the repossession falls off your report and won’t show up during credit inquiries.

Fair Credit Reporting Act (FCRA)

Repossession laws vary from state to state, but many allow lenders to take possession of the item you financed the moment you fall behind on payments. They can do this without approval from any state or federal organization.

Though most of these repossessions are legal, some are wrongful and should be disputed with the credit bureaus immediately. The Fair Credit Reporting Act (FCRA) ensures the right to dispute wrongful or inaccurate repossessions.

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The act also protects borrowers by ensuring your credit report’s accuracy and that your information remains private. It also gives you the right to know if negative information in your credit report is used against you in future loan or credit applications.

2: Review Your Credit Report

If a lender repossesses an asset, regardless of type, requesting a copy of your credit report is a good idea. You’re entitled to one free report each year from the three major credit bureaus: Experian®, TransUnion®, and Equifax®. You may be able to request a report from your bank or financial institution, but you can also request free reports from AnnualCreditReport.com.

When you review the information in your credit report, check for inaccuracies. This could include:

Accounts that you closed that still show up as open
Newly opened accounts that are not showing up on your report
Repossessions that are more than seven years old
Repossessions that didn’t actually happen

Identifying errors and taking steps to resolve them can help you restore your credit score and may make it easier for you to borrow money in the future. If you notice any errors, you can dispute them with the credit bureau.

3: Dispute Inaccurate Repossessions

Disputing inaccurate repossessions is the best way to ensure that the information in your credit report is accurate and gives lenders a clear picture of your current financial situation.

Though the exact steps to dispute inaccurate repos and get inaccuracies removed from your credit report may vary slightly from bureau to bureau, here’s what you’ll need to do to start:

Identify the error. Make sure you know which repo is showing up on your credit report and which company or lender provided the inaccurate information. If you corrected errors on late payments, your report may still show that your lender repossessed an item even if they didn’t.
Initiate your dispute with the credit bureau. Each credit bureau should have a dispute form that you’ll need to fill out. You may also need to send a written letter to each bureau reporting the incorrect information. In the letter, explain the inaccurate repo you’re seeing, what’s incorrect about that information, and who reported the information to the bureau.
Contact the company responsible. You’ll also want to contact the lender, bank, or company that reported the repo to the credit bureau. Send them a letter explaining the error, request they review the information and send an updated report to each credit bureau.
Wait for the bureau to investigate. The credit bureaus will investigate every dispute they receive. If they identify errors, they’ll update the information in your credit report, which may cause your score to increase. Keep in mind that they’ll leave accurate repossessions on your report.

If the credit bureaus or your lender deny your dispute, ask for a copy of the investigation report. The report should include information about why they denied the dispute. If you feel the denial is invalid, you can file a complaint with the Consumer Financial Protection Bureau (CFPB).

4: Negotiate with the Lender

If the repossession is accurate, it stays on your credit report. But that doesn’t mean you can’t do something about it. You may be able to negotiate with your creditors. Negotiations may help you reach a debt settlement or new payment plan that could encourage the lender to resolve the repossession on your credit report.

Every lender wants to collect the money it owes, and many will be open to negotiating a payment plan. Contact your lender and see if they’ll consider a “pay for delete” agreement. This agreement means you repay the loan based on the newly negotiated repayment terms in exchange for the lender removing the repossession from your credit report.

If you repay the loan in full, this can help you improve your credit score. But it does mean you’ll have to pay the loan back, which could strain your monthly budget.

5: Consider Debt Settlement

Debt settlements allow you to work out a lower repayment agreement with your lender. Unfortunately, these settlements are not guaranteed, and many lenders may hesitate to accept less than you owed originally. However, some may be open to getting at least some of the money you owe in exchange for removing the repossession from your credit report.

Contact your lender and discuss your options. Be sure to mention that you’re interested in a debt settlement agreement. The key to successfully navigating debt settlement lies in being willing to work with your lender. Be clear about your financial situation, but be flexible in the terms you’re open to considering.

6: Wait for the Repossession to Age Off

If you’re wondering how long it takes for a repo to get off your credit report, you’re in luck. Repossessions won’t stay on your credit report forever. They’ll only stay on your credit report for seven years. After seven years, they won’t appear on your report, and lenders and credit card issuers won’t know you’ve dealt with a repossession.

Over time, and with good financial practices, your score will likely improve, even before the repossession ages off. Once the repo is off your report, your score should be higher, and you’ll be better able to qualify for loans and credit cards.

7: Legal Help and Financial Counseling

Repossessions can be a sign that your finances are struggling more than you may be comfortable with.

If you’re having trouble repaying your debts, have more debt than you can manage, or just want professional advice, it’s a good idea to speak with a financial advisor or credit counselor. They can help you explore debt management options like bankruptcy and credit counseling.

If credit counseling is a better choice for your situation, your counselor can help you figure out how to get your finances back on track.

How to Get a Repo Off Your Credit Report FAQ

Here are a few common questions about getting repossessions off of your credit report.

How Can You Fix Your Credit After a Car Repossession?

You can fix your credit after a car repossession by checking your credit report for errors. If the repo was reported in error, filing a dispute with the credit bureaus could help you get the repo removed from your report, thereby increasing your score. If your car was repossessed, you can either wait for the repo to fall off your report after seven years or start looking for other ways to boost your score like:

Paying down your existing debts
Making payments on time and in full each month
Only borrowing what you need and what you can afford to repay

Can You Pay to Delete a Repo?

You may be able to pay to delete a repo. Contact your lender to see if they’re willing to negotiate payments on what you owe. If they agree to a pay-to-delete and you pay the agreed amount in full, they’ll request that the credit bureau(s) remove the repo from your credit report.

How Can You Get a Voluntary Repo off Your Credit

If the information on your credit report is inaccurate, you may be able to get the voluntary repo off your report by disputing the error. But if the repo did happen, you have several choices. You can wait for the repo to fall off your report after seven years or negotiate a pay-to-delete agreement with your lender.

Get Your Credit Right

Repossessions can impact your credit, but knowing how to get a repo off your credit report can help you boost your score over time. But even if you can’t remove the repo from your report, you can still take steps to improve your score.

Start by making at least the minimum monthly payments on all of your outstanding debts on time each month. And don’t hesitate to ask for help repairing your credit score.