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rebuilding credit with nominal payment

I am eligable to claim bankruptcy but would prefer not to, I have 2 vehicles that had been repossessed so owe over $20,000 on them, I want to rebuild my credit and was told if I set up a payment plan where I even paid $50 a month my credit score would build so long as I did not miss payment, is this true?

Posted from: Ontario

One Response to “rebuilding credit with nominal payment”

Barton Goth – Goth & Company Inc. -Trustee in Bankruptcy said...

This all depends on what you have worked out with the lender. If you have made payment arrangements directly with them and they agree to report to the credit bureau that you are making payments as they become due, then it can help to re-build the rating. However, often once the car is repossessed the notation on your credit bureau that reflects this repossession is listed for 6 years from the date the associated debt is paid in full. It all really depends on what the lender agrees to in terms of reporting to the bureau.