HI, My wife and I are looking to purchase a new home. We are going to wait atleast a year so we can clean our credit reports up. We hope to have atleast 10k for a down payment and are looking to get a house from 90-120k. I am 25 and my wife is 19. The problem is that before we got married she financed a car that was too much for her. Long story short, she had it volutarily repoed. The loan was for 24k, which is bull because the car only cost 16k. Well they sold the car at an auction for 12k so we have a 12k deficiency. We have moved in the last 3 months so they don't know where to contact us. The question is, how will this effect or chances at getting a home? Will this have to be paid off prior to closing even if the debt is over 2 years old? Are we better off contacting Nissan Acceptance Corp and set up payment plans? Please help! Chris
Have they come after her at all for the deficiency? Some creditors will go after you and slap you with a judgment which will hurt you more. Some states do not allow them to sue so you might want to check your state laws regarding that. You might also want to sit down with a loan officer and have them give you an idea of what you are going to need to do. You can always post what they told you here and let everyone help. There are loan officers and underwriters on here so I am sure they will chime in as well. Here is a link to give you more insight until then: http://www.mortgageunderwriters.com/creditg.html
It will hurt you until it is no longer on your report, which I doubt they will let $12k get past the SOL. What I would suggest you do is offer settlement for paid as agreed or delete. The settlement can be monthly payments, but make sure if you agree to monthly payments they agree to change your report right away.
If I have payment arangements with them, do I have to have it fully paid off before closing? Or is that I am paying it monthly ok???
My husband had a similar situation with Toyota Motor credit. My advice is to set up a payment plan and GET IT IN WRITING that they will either delete it from your credit report or at least say it is Paid in Full. My husband bought a house while paying it off and he had to provide the letter to the mortgage company and jump through some other hoops. He paid it off before we bought our house and we were able to get a great interest rate thru Well Fargo. If you can pay it off before you buy the house then do it, if not make sure you have something in writing to provide to the mortgage company.
