Repossessions are a negative item listed on your credit report that can hurt your credit score for at least 7 years. Repossessions can be removed from your credit report in some situations by sending a dispute letter.
Car Loans from Banks and Credit unions
When you sign a loan for a vehicle, you are signing for a direct loan. This direct loan is simply saying a bank or credit union has preapproved a loan that you can use to purchase a car from a dealership.
Car Loans from Dealerships
If you are not using a loan from a bank or credit union and using the dealerships’ financing than the dealership is your “lender” by documentation. Guess what? the dealership is not your loan lender. In fact, the dealerships sell your contract to an outside company to take responsibility of your loan.
If the document you sign states the dealership is the loan lender and not the company they sold it to you can dispute the item because it is inaccurate and not true.
The Repossession dispute process is similar to the Credit Bureaus Dispute Process. The only difference is:
Phase One: During this phase there are two letters you will send out. The Credit Bureau Dispute Letter 1 to the credit bureaus and the Vehicle Repossession Letter to the Dealership, bank/lender, and/or collection agency.
Phase Two: During this phase, depending on the results you get back, you will send out either a Credit Bureau No Response Letter or Vehicle Repossession Letter 1.
Phase Three: During this phase, depending on the results you get back, you will send out either a Credit Bureau Warning Letter or Vehicle Repossession Letter 2.
Also, rather than waiting 30-31 days for a response, all you need to wait before sending a response is 15 days.