When you obtain a secured loan or a line of credit, it allows you to borrow against the value of something you already have or are purchasing, like a house or car. The house or car in this case would be considered collateral. Until you’ve paid back the loan, the lender technically owns that collateral. If you’re late on payments, the lender may decide to seize the collateral. The seizure of this collateral is called a repossession—or a repo.
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How Long Does a Repo Stay on Your Credit?
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