The emotional impact of the repossession of a Wisconsin person’s belongings, along with the fact that such actions are public record, can be severe. Furthermore, when defaulted payments lead to repossessions, the impact can be more significant than the hurting of a person’s pride. One of the consequences of repossession is the substantial drop it will cause in a consumer’s credit score.
If a person’s belongings are repossessed, he or she will still not be off the hook. The debtor will still be responsible for the outstanding amount, which will be the difference between the amount the lender manages to recoup and the unpaid debt balance. If a consumer is unable to pay the balance, the lender may file a lawsuit for it. Also, the repossession will remain on the individual’s credit record for seven years.
Consumers are often warned about companies promising to cancel repossessions from credit records. Be careful, as many times, these are scams that can rid a consumer of even more money. Repossession laws vary from state to state, and, for this reason, it may be wise to acquire the relative information related to state laws. A consultation with an experienced bankruptcy attorney can provide that information.
During such a consultation, a Wisconsin consumer can also discuss the available options to prevent repossession. Filing for bankruptcy provides protection against such action in that an automatic stay becomes effective upon the filing for personal bankruptcy. Although bankruptcy will also remain on an individual’s credit record for many years, a Chapter 13 bankruptcy will provide the filer the opportunity to make up the defaulted payments along with future payments over an extended period, while keeping his or her property. A bankruptcy attorney can explain the requirements for the available chapters under the U.S. Bankruptcy Code.
Source: jeremymarcusfinance.com, “Repossession and its impact”, Jeremy Marcus, Accessed on Feb. 13, 2016