Can You Get a Car Loan After a Repo?

Yes, you can get a car loan after a repossession, but securing financing can be tough with a blemish as serious as a repo on your record. Even if you have reaffirmed on the repo and paid the back balance, it may still present a difficult hurdle when seeking financing. You might stand a better chance if some time has passed since the repossession, and if you have successfully paid off other vehicle loans since that time.

Impact of a Repo

A vehicle repossession remains on a credit report for seven years from the date the loan was originally reported delinquent, not the repo date. Therefore, if you have a repo on your credit report, the true impact will vary based on how long ago it occurred. If it is more than seven years since the first delinquency, the repo will not factor into the credit decision. For repos still in your report, the impact will lessen depending on how far the repo is in your past.

Managing a Repo

If you have repossession on your credit report, there are ways you can help salvage your credit score and your ability to get financing for another car. Managing your other debts and paying debt obligations on time can help you keep your credit score respectable. However, even with a good payment history on your other debt, it can still be difficult to secure another car loan. Auto lenders will still consider you a risk with secured debt.

Reaffirming on the Repo

If you can pay the back balance after the lender repossesses your car, you can regain physical possession of the vehicle. You also must pay any repossession and towing fees charged to your account. The process of paying the back balance to get your car back is "reaffirming." However, even if you reaffirm on your repo, the negative impact will remain on your credit report and can keep you from getting a loan.

Strengthening Your Application

If your repossession occurred recently, or you simply do not have the credit history or income to get approval for another car loan, finding a cosigner with a better credit history can help you get the car or truck you want. Verify that the prospective cosigner has a consistent source of income and a good credit history. Otherwise, your efforts to use a cosigner to strengthen your application could be an exercise in futility.