3 Secret Strategies to Remove Car Repos

Author: Credit Repair Hacks
Aug 01, 2023

CREDIT REPAIR HACKS By: D. Saul
Dequontis D. Saul
REALTOR® & Money Coach

Introduction

Sometimes we fall short and make bad financial decisions. ESPECIALLY WITH VEHICLES! The good news is that none of what you did in the past is permanent. There’s not a single credit score that can’t be fixed within one year. Follow these 3 strategies to navigate your way to a 700 credit score!

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3 Secret Strategies to Remove Car Repos

Strategy #1 - GAP Company Method

When you purchased your vehicle, did you get GAP coverage? If so, you just might be in luck!

This strategy is used to get repossessed vehicles deleted from your credit report by a written factual dispute. The success rate is just above a 80% deletion rate!

This strategy only works for auto loans that have GAP coverage where the vehicle is repossessed, sold at an auction, and then the balance is sold to a 3rd party Collection Company.

Timing is important. So follow each step closely.

Usually when you purchase a vehicle from a dealership, you get GAP insurance. If the GAP insurance is for the life of the vehicle, a portion of the vehicle is covered by the GAP Company if the vehicle is considered a loss.

A repossession is considered a loss, so when this happens the refund by the GAP Company is sent to the Auto Financing Company.

But wait, here’s the kicker.

Almost every time the Auto Financing Company gets the GAP payment a long time after the account is sold to the Collection Agency and never updates the balance of the loan on your credit report. YES! This means that the balance is WRONG and that is all you need to prove that the repossession is inaccurate. DELETED!

Strategy #2 - Wrong Account Type Method

Creditors screw up all the time by using the wrong terminology to indicate the type of account for the vehicle.

Auto dealerships will use one of two different types of accounts.

1. Credit Sale - The auto dealership sells the loan to a lender.

2. Installment Loan - The dealership lends you money and you pay the dealer in “installments” until the loan is paid in full.

Most dealerships choose to use “Credit Sales” because they get paid the full amount of the vehicle immediately, instead of getting paid little by little each month with a loan.

There is a pretty good chance your account was a Credit Sale if you signed your new vehicle documents at a dealership. Review your credit report closely. If it says “Installment Loan” (or something similar), you can dispute the vehicle repossession by pointing out that specific error.

Here’s an example: “This account you are reporting is reported as an “installment loan” which is factually incorrect. The correct account type for this account is a “Credit Sale Agreement.” I have the right to an accurate credit file and discrepancies like this are unacceptable. Please remove this account from my credit file immediately.”


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Strategy #3 - Incorrect Late Payments Method

Is the creditor still reporting late payments for your repossession? If so, check this out.

Vehicles are sold at an auction for a fraction of what is actually owed for the vehicle. This left over balance is called a deficiency balance. When this happens, how can the original creditor still report late payments for a car that’s repossessed?

Well you have good news - THEY CAN’T!

But they usually make this mistake and you can use this to get the item deleted from your credit report.

Reporting late payments after the vehicle has been repossessed is a big error. All you need to do is dispute the error by pointing out that the vehicle was repossessed and defaulting on payments is impossible and inaccurate.

Here’s an example: “This account you are reporting is reported as a ''repossession,” but late payments are continued to be incorrectly reported. Since the vehicle is repossessed and no longer in my possession, it would be impossible for me to default on payments after the fact. I have the right to an accurate credit file and discrepancies like this are unacceptable. Please remove this account from my credit file immediately.”

ALSO: Something else to look for and dispute is a “monthly payment amount” showing up on your credit report after the vehicle has been repossessed. A monthly payment should not exist after a repossession has happened, right? DELETED!

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See Step by Steps Below!

BEFORE WE BEGIN….

GET A DETAILED CREDIT REPORT

For best results get a copy of your full FICO report from all 3 bureaus. Use my personal link to get FICO reports from all 3 bureaus for only $1: Click here: MyScoreIQ - $1 Reports

RULES AND ORGANIZATION WHEN DISPUTING ACCOUNTS

Send all dispute letters by certified mail. It’s important to send letters certified so you can not only keep track of the timeliness of your dispute process, but to be able to prove that you sent correspondence to the credit bureaus and creditors. In the event where you do not get a response within the 30-day investigation window, you will have this proof to better your case of getting items removed.

Make copies of each letter you send. It is important to have proof that the credit bureaus and creditors received your letter AND for you to prove exactly what the letter said. This will come in handy if you file a complaint with the CFB.

Include 3 forms of identification with your letters. With each letter you send, include:

● Two (2) forms of ADDRESS: This has to be your current address. It can be your Driver’s License, State ID, Pay Stub, W2, Utility Bill, Bank Statement, or Credit Card/Phone Bill Statement.

● One (1) form of SOCIAL SECURITY: This can be your social security card, recent W2, or recent Pay Stub as long as it shows your full social security number and name.

Date and sign each letter. Mail individual letters to each of the 3 credit bureaus. If you are disputing with the credit bureaus directly, make sure you mail a separate letter to each bureau.

If necessary, include enclosed copies of all supporting documentation and a copy of your recent credit report with the questionable, disputed items circled.

Remember to DOCUMENT and MAKE COPIES OF EVERYTHING.


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CREDIT BUREAUS

Equifax

P.O. Box 740256

Atlanta, GA 30374-0256

888-548-7878

Equifax

P.O. Box 4500

Allen, TX 75013

888-397-3742

Equifax

P.O. Box 2000

Chester, PA 19016

800-916-8800

STRATEGY #1 GAP Company Method

Note: Timing is critical – Complete Step 1 and 2 the same day!

1. Use the Debt Validation Letter and send it to the Collection Agency

2. Send your letter as Certified Mail with the return receipt requested.

The key is hoping the Collection Agency responds to your dispute with the incorrect balance. This usually happens because GAP pays the Auto Auto Financing Company and they forget to report the updated balance to the Collection Agency..


Congrats!
If this doesn’t get the deletion, then file a complaint with CFPB and resend all the above documents you had previously sent along with copies of the letters you sent to the credit bureaus in Step 3.

You can file a complaint with the CFPB here:
https://www.consumerfinance.gov/complaint/

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STRATEGY #2 Wrong Account Type Method

1. Use the Debt Validation Letter and send it to the Collection Agency.

2. Send your letter as Certified Mail with the return receipt requested.

3. Use this special explanation in your letter:

“This account you are reporting is reported as a ''repossession,” but late payments are continued to be incorrectly reported. Since the vehicle is repossessed and no longer in my possession, it would be impossible for me to default on payments after the fact. I have the right to an accurate credit file and discrepancies like this are unacceptable. Please remove this account from my credit file immediately.”

The key is pointing out the error to your creditor and then disputing the error to the credit bureaus. You are hoping that the Collection Agency does not respond to your dispute and fails to update what they report to the bureaus.

Congrats! If this doesn’t get deleted within 30-45 days, then file a complaint with the CFPB and resend all the above documents and any other necessary documents you have along with copies of the letters you sent to the credit bureaus in Step 2.

You can file a complaint with the CFPB here:
 https://www.consumerfinance.gov/complaint/

STRATEGY #3 Incorrect Late Payments Method

Note: Timing is critical – Complete Step 1 and 2 the same day!

1. Use the Debt Validation Letter and send it to the Collection Agency.

2. Send your letter as Certified Mail with the return receipt requested.

3. Use this special explanation in your letter:

“This account you are reporting is reported as an “installment loan” which is factually incorrect. The correct account type for this account is a “Credit Sale Agreement.” I have the right to an accurate credit file and discrepancies like this are unacceptable. Please remove this account from my credit file immediately.”

The key is pointing out the error to your creditor and then disputing the error to the credit bureaus. You are hoping that the Collection Agency does not respond to your dispute and fails to update what they report to the bureaus.

Congrats! If this doesn’t get deleted within 30-45 days, then file a complaint with the CFPB and resend all the above documents and any other necessary documents you have along with copies of the letters you sent to the credit bureaus in Step 2.

You can file a complaint with the CFPB here:
 https://www.consumerfinance.gov/complaint/

Click HERE to use these tips with our DIY Credit Repair Kit

CLICK HERE: How I Fixed My Own Credit in 6 Months DIY Kit

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