What Happens to the Truck Loan If the Vehicle Gets Repossessed

George Morfoulis

When you take out a loan to buy a truck, you agree to pay back the money you borrowed. But what happens if you can’t make the payments?

Sometimes, the company that lent you the money might take back the truck. This is called repossession. Let’s talk about what this means for your truck loan and what you can do about it.

Understanding Repossession

What Is Repossession?

Repossession happens when you don’t keep up with your truck payments.

The lender, or the company that gave you the money to buy the truck, has the right to take it back if you break the deal by not paying.

How Does Repossession Work?

If you miss payments, the lender will warn you. If you still can’t pay, they will take the truck back.

They don’t need to ask you for permission, but they must follow the law. This means they can’t break into your garage or threaten you to get the truck.

Impact on the Truck Loan

What Happens to the Money You Owe?

After the truck is taken back, it is usually sold. If the truck sells for less than what you still owe, you might have to pay the difference.

This is called a deficiency balance. For example, if you owed $10,000 on your loan and the truck sold for $7,000, you would still owe $3,000.

Extra Costs

Taking back and selling the truck costs money, too. You might have to pay for these costs, which can add to what you already owe.

Legal and Financial Consequences

Your Credit Score

Having a truck taken back can hurt your credit score. This means it might be harder for you to borrow money in the future.

This mark stays on your credit report for seven years.

Deficiency Judgments

If the truck’s sale doesn’t cover what you owe, the lender might ask you to pay the rest. This is called a deficiency judgment.

It means you’re legally required to pay the remaining balance.

Options and Solutions

How to Avoid Repossession

The best way is to talk to your lender if you’re having trouble making payments.

They might let you pay less for a while or give you more time. It’s important to talk to them before they decide to take back the truck.

What to Do If Your Truck Is Repossessed

If your truck is already taken, you still have options. You might be able to buy it back or settle the remaining money you owe for less.

Sometimes, talking to a lawyer or a financial advisor can help you find the best solution.


Losing your truck because you can’t make the payments can be tough. But understanding how repossession works and knowing your options can help you deal with this situation better.

Always try to talk to your lender first.

They might be able to help you avoid losing your truck.

Remember, it’s important to think carefully before taking out a loan to make sure you can keep up with the payments.

By keeping these points in mind, you can better navigate the challenges of repossession and protect your financial future.

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