21 Sep My credit report shows a repossessed car account as open. What gives?
Q. My car was repossessed more than three years ago. The finance company sold it but it’s still showing the account is open and every month they’re reporting a late payment. Are they allowed to do this?
A. Unfortunately, yes.
Like you, many people are unaware that even if their vehicle is repossessed, they may still be liable for the deficiency amount, said Karra Kingston, a bankruptcy attorney in Union City.
The deficiency amount is any money that is still owed after the car was sold off at auction, she said.
“Lenders can still sue for that amount even after the car has been repossessed and sold,” Kingston said. “It may be a good idea to call and ask if there is any outstanding balance to ensure the lender is reporting it correctly.”
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This story was originally published on Sept. 21, 2020.
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