How Many Points Will My Credit Score Increase When a Repo is Removed?

A repo or a car repossession refers to an incident where someone’s car is towed away from them or “repossessed” by the lending party that gave out the car loan. They are often done in secret and the auto lender may or may not have a court order to do so.

This occurs when the lending party falls behind on multiple payments and refuses to cooperate or even stay in contact with the lender. If you have been unfortunate enough to have your car repossessed, it will sink your credit score, and in the process, reduce your chances of getting loans in the future as well.

How Many Points Do You Lose?

The exact number may vary a bit, depending on the exact circumstances, but it has been estimated that a repo can potentially shave off as much as 100 points from your total credit score.

Needless to say, it’s a big blow to your financial credibility even if you had a good record before that, but in case your scores were already pretty low, a repo will absolutely destroy your credit score.

How Long Do the Effects of Repo Remain on Your Record?

Generally, the repo record and all the associated red flags stay on the record for about seven years. This means that unless you take adequate measures to get the repossession, the late payments, collections, and the judgment (if the creditor sues you successfully) off your records sooner, you will either not be getting any loans at all, or will be getting them at exorbitant interest rates.

How Many Points Will be Added When a Repo is Removed?

After a repo is removed, it will take some time for the credit score to be updated as such, but it will essentially gain back the points it lost due to the repo and the associated financial blemishes we already discussed.

Therefore, you can expect your credit score to increase by as much as one-hundred points after a repossession record has been removed from your financial history successfully, and the score gets updated with it.

How Should You Remove Repos?

Unless you are willing to wait it out for seven whole years, you need to hire a credit repair company to have the repossession record removed earlier.

Keep in mind that they cannot guarantee success, as it largely depends on the creditor. Nonetheless, credit repair companies are usually able to remove repos much earlier than usual by convincing the creditor to do so.
Once the creditor is convinced and the repo is removed, they will then get to work on other aspects of your credit score that can be removed or improved to raise the overall score.

If you think you are in danger of losing your car to the auto lender, it is wise to take action from your end, before they tow your vehicle away. Do not dodge calls, but instead try to find a way to work it out or get a deferment. If you can’t find the funds or a feasible plan to get out of the bind in time, just sell the car on your own to get the rest of the money and pay the whole loan off at once.