Feb
15
Should I get a loan to pay for my repossession (car)?
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I owe 8000 on a repossession. I’m paying $175 a month. If I settled I could pay $5000 or $6000. Should I get a personal loan for this amount? The financing co. says that if I pay the settlement they will “remove the derogatory marking from my credit report” I ask because I am thinking about buying a house or at least moving to another apartment and the bank says that I can’t be considered without paying off the reposession. My credit score is 640. Thanks.
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6 Comments
February 17th, 2010 at 4:06 am
If you have a 640 score with a repossession that’s awesome. Talk with a mortgage broker rather than a bank loan officer. The fact that you have a plan in place that you’ve been paying $175 for is good. Hate the idea of you paying $8000 and still not having the vehicle.
February 20th, 2010 at 2:12 pm
That’s not a terrible credit score, and you can probably find a mortgage with it. That said, if you can get out from the under the repo with a settlement, you might be better off. Question is what interest rate you’d pay for the personal loan. I’d look at the total picture with a cold, hard eye, adding all the dollars up with the different options. Better credit score, lower mortgage payment. Worse credit score, higher payment. Repo company charging you $175/mo to pay off the $8000–what is the interest rate? How long will you be paying? What would be the interest rate, payment amount, and time period to get a personal loan to pay off $5-6,000?
February 21st, 2010 at 9:36 am
No! The repo is always going to show in your report for the next 7 yrs and depending in the state you live in it may be longer or less years that show in the credit report.Your credit score is not going to drop unless you stop making those 175.00 payments. Your credit score will now be based on your current payment plan you have but, with a repo in the notes.So you can have a 720 with a deragatory account or revolving accounts.Also just so you know making a loan will only decrease your score and give you 2 pymnts now.The only thing your doing is reducing the amount you owe for the car.The banks offer many types of loans for this type of situation dont get a loan and dont get a morgage loan application now wait at leat 6 months and there is apartments out there that will take you after they see how you are paying the repo back.
February 23rd, 2010 at 9:52 pm
Yes ofcourse you will get one. Now banks hardly see your credit before giving loans and you have 640 which is almost good. You can try to find some with low interest rates and with easy terms.
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February 27th, 2010 at 2:55 am
I think that you should not get into further debt by getting
a new loan to pay off the bad loan. derogatory credit can
only be indicated that you paid off, but not removed. You should make a wise decision with making
a larger payment arrangement with the creditor to pay off over time, perhaps within 1-2 years without struggling.
You may have to wait with the new house or apartment
until you are able to do so.
March 2nd, 2010 at 4:22 am
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