How to Negotiate a Bank Repo

How to Negotiate a Bank Repo
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Your bank can take your vehicle if you miss even one car payment, the Federal Trade Commission warns. This is known as a repossession. It takes away your transportation and blemishes your credit reports. You may owe additional money because the lender may not be able to sell the car for enough money to cover your outstanding loan. Banks would prefer not to repossess, the American Financial Services Association explains, because it often results in a loss. You may be able to negotiate a repossession alternative with the bank.

List repossession alternatives to discuss with the bank. You may just need a simple modification, like a change in payment due date to coincide with your paydays. You may need to skip one or two payments if you lost your job but have good prospects for another one. They can be added to the back end of your loan, extending the payback period by one or two months. You may be buried under late payment fees and need them to be waived so you can afford your regular payment. Lenders are often open to these solutions, Russ Heaps of explains.

Call the bank and ask to speak to a loan officer or supervisor who has the authority to negotiate with you. Heaps recommends being proactive in calling as soon as you realize you are at risk of repossession, which typically happens when you have missed at least one payment.

Propose your preferred alternative to the loan officer or supervisor. He may agree or be willing to negotiate something similar. If not, propose the next idea on your list if you have one. Otherwise you can ask for his suggestions. Make it clear that you want to avoid repossession and are willing to work with him within the constraints of your current financial situation.

Ask for a copy of the agreement in writing once you have negotiated a solution to prevent repossession. The bank should be willing to provide this; if not, it is not obligated to follow through and could still end up repossessing the vehicle.


  • Most people don't talk to the bank until repossession is looming, but Justin Leach of Toyota's financing arm recommends calling as soon as you realize you might have a problem. This can head off collection calls and repossession threats.


  • If you cannot negotiate a solution to prevent a repossession, Lectric Law Library warns that you might be held liable for expenses related to a repo company taking the car. Prevent these costs by arranging for a voluntary repossession in which you turn in the car yourself rather than forcing the bank to send someone to retrieve it.