Repossession is the legal process by which the lender or his agent takes back the item that you bought on credit. That's how the bank takes back your house since it was used as collateral for the money they loaned you to buy it.
By the way, Repossession on a home is called foreclosure!
Basically when you don't pay up (going into default) The person who loaned you the money will take back that nice car or nice house you just bought on credit.
Repossession affects your credit score
if you've had a repossession in the last two to three years it will definitely affect your credit score
When a creditor has a security interest in an item you purchased. That means the creditor has the right to take back the item if you do not make payments on the loan.
What is a secure loan?
Secure loan are loans where you borrow money to buy a certain item and give the creditor a security interest or collateral in an item.
Example:
Car loan. When you take a car loan, you give the creditor the right to take the car back if you do not pay the loan.
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