January 15, 2026
Unpaid loan on repossessed car still showing on credit report
Dear Consumer Ed:
My car was repossessed and sold. Is it legal for the lender through which I financed the vehicle to continue to report the outstanding balance to the credit reporting agencies?
Consumer Ed says:
Yes, lenders are allowed to report a vehicle repossession to the credit reporting agencies even after the vehicle in question has been sold. The missed payments and defaulted loan that preceded the repossession will remain on your credit report for up to seven years.
Negative information on your credit reports, and the resulting drop in your credit scores, can make it harder to get approved for new loans, insurance, and credit cards; and even if you are approved, you may be subject to higher interest or premiums. The good news is you can still take steps to improve your credit score by paying your bills on time, keeping credit card balances at reasonable levels, paying more than the minimum monthly payment, if possible, and not taking on new debt.
You can find a wealth of information about buying and financing a vehicle at https://consumered.georgia.gov/your-car.
For information about credit, debt, and managing your money, visit https://consumered.georgia.gov/your-money.
Submit your own question to Consumer Ed. Remember…we do not give legal advice. Always consult a lawyer about legal issues.