You can still buy a car if you have a repossession on your credit reports, but you may find it more difficult to get approved for an auto loan. While a repo stays on your credit reports for up to seven years, its impact lessens over time, and there are lenders out there that work with people that have dealt with repossession.
Where to Get Auto Financing Post-Repo
Finding the right dealership to get a car loan from isn’t easy after repossession. While Auto Credit Express can help you find a dealer, let us explain the types of dealerships you could be working with.
There are two types of dealers that help those dealing with a repo on their credit reports: special finance dealerships and buy here pay here (BHPH) dealerships. Both can offer credit amnesty, but they have different, specific requirements to qualify.
Special finance dealers work with subprime lenders. These lenders know bad credit, and although they check your credit, they look at other factors including income, residence stability, and down payment.
Ideally, you want to finance through a subprime lender since you get a chance to build credit with an auto loan. However, not all subprime lenders can offer approvals to those dealing with a recent repossession.
If a subprime lender turns a borrower down, their next best bet is a BHPH car lot. Buy here pay here dealerships offer in-house financing, which means they're also lenders. This means you can get a vehicle and a loan through the same place.
Many of these dealers don’t run credit checks, so it won't even matter if you have a repo on your credit reports. However, this may also mean they don't report your loan or on-time payments to the credit bureaus, which means the loan can't help you improve your credit.
Regardless, their requirements for financing are fairly straightforward: meet their income and down payment standards, and you shouldn’t have an issue getting approved.
Can I Remove My Repossession Earlier?
Now that you know the types of dealerships you could be working with, you may be wondering if it’s possible to remove the repossession from your credit reports before the seven-year expiration date.
It is possible, but the repo needs to be listed incorrectly. Unfortunately, there’s no way to remove a repossession that’s correctly reported, and it won’t go away until the seven years from the date of repo.
You can remove an incorrect listing is by checking your credit reports and disputing the repossession error to the credit bureau(s). You need to provide proof that the repo is incorrect, and the credit bureau must investigate your dispute and come up with a decision within 30 days. If they don’t reach out to you in time, the repossession is automatically removed.
Need Help Finding a Dealer to Work With?
If you have a repossession listed on your credit reports and worry it’s going to affect your chances of getting approved for auto financing, have no fear. At Auto Credit Express, we specialize in helping credit-challenged car buyers find a local dealer that can help.
With our nationwide network of dealerships, and over 20 years of experience, we want to help you get the vehicle you need. All you have to do is complete our free, no-obligation auto loan request form, and we’ll get right to work for you.