1) If the collection agency bought the debt--even for pennies on the dollar--and it was assigned to them, then it is now their debt and they have a legal right to enforce it or collect on it. That means that they could repossess the car and/or sue you.2) Bankruptcy will stop collections efforts, but the creditor or collections agency will still be able to repossess if the debt is not eventually paid. A chapter 13 bankruptcy would, besides at least temporarily halting collections and giving you some time, also give you some tools which may help reduce the amount owed on the car (called a "cram down")--you'd still have to pay, but less. This is something to discuss with a bankruptcy attorney.3) Note that will bankruptcy temporarily stops collections, it doesn't reverse actions already taken; if the car is repossessed and resold before you file, you will lose it.