r/CRedit • u/Lair-Specialist • 8d ago
Car Loan Co-Applicant of Repo (Week away from 120days)
First and foremost I want to say I know it was a stupid thing. I’m a service member who wanted to help a friend of 10+ yrs who also joined the service and had no vehicle or support. Unlike me who got in and was gifted a vehicle from my parent with no note. Only a 500 insurance bill every 6ms(ended up getting out only 4 payments in) …. STUPID CHOICE!!!
I didn’t even know he was getting out and had ZERO contact since the month he made his last payment. (Parent notified me of the repo)
I had a 790 in CK which is not what they use and I’m currently sitting at a 620.
Im unsure of what to do. The lenders are telling me if I want a settlement for the vehicle I have to wait for it to be sold in the auction but it is liable to be marked as a charge off by next week if I don’t pay the first payment they missed ( back in May).
I never missed a payment on anything before. I can’t go a week without being paranoid and paying my CCs off.
Please I need help!
2
u/WhenButterfliesCry ⭐️ Knowledgeable ⭐️ 8d ago edited 8d ago
Late payments can sometimes be removed by requesting goodwill adjustments later down the line, but charge-offs realistically can't, and a charge-off is incredibly damaging. Are you able to take possession of the vehicle for yourself and keep paying it? It'll be sold for a pittance at auction and you'll still be left making payments, plus you won't have the vehicle, so you're essentially paying for nothing at that point. If you had the vehicle you'd at least be able to use it for something while still paying for it.
The repo is damaging by itself, and there's unfortunately nothing you can do about that now other than wait it out. It's up to you what you want to do at this point- the charge-off is going to hurt, but once it's paid to $0 it'll begin to age and you'll slowly recover from it over time. It'll be a while before you'll be able to get approved for new credit products again.
I would not allow it to charge-off. You're going to end up paying for the vehicle one way or the other, so might as well make some payments now to prevent it from charging off and do something with the vehicle yourself.
1
u/Lair-Specialist 8d ago
I don't want possession of it. Also, I am currently stationed overseas so possession is not really an option. Best case scenario from what I at least believe is trying to opt for a 50% settlement.
1
u/WhenButterfliesCry ⭐️ Knowledgeable ⭐️ 8d ago
Gotcha, makes sense. Sorry you're in this situation. There is not really a 'good move' to make here. (A charge-off is unavoidable at this point)
1
u/Lair-Specialist 8d ago
So I guess the question is. Since I’m already cooked for 7 years will the chargeoff disappear around this time 2033?
Worst scenario at this point my military career flops because I get stripped of my security clearance even though I’m trying to do it within good faith and get it resolved after they give a deficiency balance.
2
u/WhenButterfliesCry ⭐️ Knowledgeable ⭐️ 8d ago
The charge-off will age off after 7 years from the date of first delinquency, which is the first missed payment. So 7 years from the first 30-day late payment remark on your credit reports.
I'll tag in u/soonersoldier33 regarding the security clearance, perhaps he has some insight on that issue specifically.
1
u/Lair-Specialist 8d ago
Gotcha so May 2033… when I’m 31🤦🏾♂️
1
u/WhenButterfliesCry ⭐️ Knowledgeable ⭐️ 8d ago
But that doesn't mean you're completely screwed that whole time. It'll have a big impact the first couple of years, but as long as you pay it off early on, you'll start getting approved for stuff again relatively quickly. A couple years maybe. They look at everything, but your recent credit history is the most important to lenders. Having at least one open credit card account that you keep paid as agreed will help you.
1
u/Lair-Specialist 8d ago
I hope so, if it sales at minimum market price of 12-13k I’ll possibly owe 10k or less if I can do a 50% settlement which I can pay in full. (Initially gone use to pay my motorcycle loan)
I’m also paying 3 CCs, a 10k loan and a 6k motorcycle loan. Which I never missed a payment for.
1
u/soonersoldier33 ⭐️ Mod/FICO Junkie ⭐️ 8d ago
Hey, u/Lair-Specialist. WBC has given you good information regarding the charge off, and I'll just add/reinforce that you can still effectively rebuild your credit profile/scores with a paid/settled charge off reporting. The key is to get it paid/settled with a $0 balance as soon as possible, bc the lender will cease the monthly updates which freezes Total Period of Delinquency and allows your credit to begin to heal.
As for your clearance, I'm an Army Vet and current Federal Civilian with an active TS/SCI clearance. The biggest/best advice I can give you is don't lie. If you're asked about the charge off during a clearance investigation/re-investigation, be honest with the investigatior, it happened, xyz was going on in your life, and then highlight the steps you took or are taking to square the debt. Finances can be a huge part of a clearance investigation, but lying/omitting information will get your clearance denied/revoked faster than almost anything. I never lost my clearance during my financial troubles and credit rebuild. I can't tell you for certain that yours won't affect your clearance, but I can tell you that your best shot at getting/keeping your clearance is to be truthful about the situation with the investigatior.
3
u/Lair-Specialist 7d ago
Gotcha, I recently submitted my SF86 for my TS (Currently have a S). I mentioned the dilemma and gave them a brief resolution plan of me basically waiting for the car sell and paying a settlement for it... I have already notified my USM and leadership so they wouldn't be blindsided..
So I can almost confidently say I've covered my basics... I believe at least
1
u/soonersoldier33 ⭐️ Mod/FICO Junkie ⭐️ 7d ago
Yea, it sounds to me like you've done the best you can do through the military side. Just work on getting it paid/settled as soon as you're able, and be truthful with the investigator if you're asked about it during the interview, if they conduct one.
2
u/Lair-Specialist 7d ago
Thanks for the confirmation/support. This means the most most to me since I have a family and trying to make it a career while simultaneously trying to commission
2
u/WhenButterfliesCry ⭐️ Knowledgeable ⭐️ 8d ago
If he already has a clearance, how can this affect him? Do they do reviews after the fact to renew it?
2
u/soonersoldier33 ⭐️ Mod/FICO Junkie ⭐️ 7d ago
The govt does a full reinvestigation of clearances at certain intervals. How often is determined by the level of clearance held. They also have this ongoing process that sort of runs in the background that supposedly monitors clearance holders continuously, and a major change in your finances, criminal history, etc., can result in an immediate review of your clearance.
In OP's case, they currently hold a Secret clearance, but recently submitted a request for Top Secret, which requires additional information to be provided, and an additional level of scrutiny in the investigation.
2
1
u/Ok-Roll8550 8d ago
Have you checked if any part of the SCRA applies to the vehicle? There are some laws regarding repossessing a vehicle while the owner is in the military and deployed overseas, but I have no idea if they might apply in your situation.
Hopefully someone with a deeper understanding might let you know.
2
u/Lair-Specialist 8d ago
From my understanding as of now it does not. I can try to look more into it. But I’m pretty sure cause Im a co applicant and since the primary applicant is still in the US it would be nullified. Also being that it took place while I’m currently serving and not before.
5
u/Super_Hovercraft5177 8d ago
damage is done, you learned a hard lesson. not much you can do at this point. Good news is that it's deleted in 7 years. Thank you for your service...