Repossession of the boat might not satisfy your obligation because when the lender attempts to sell the boat, the amount received will probably be less than the amount you owe.  Under those circumstances, the lender could sue you for the difference and obtain a deficiency judgment against you.  That deficiency judgment would have an adverse effect on your credit rating.  The amount owed on the deficiency judgment would also include interest.You might want to consider filing bankruptcy if a deficiency judgment is entered against you.  It would be premature to file bankruptcy before that judgment is entered.  Your income will determine whether or not you are eligible to file a Chapter 7 bankruptcy.  If you are not eligible to file Chapter 7, an alternative would be Chapter 13.  However, under Chapter 13 you have a budget (plan) and make payments to creditors pursuant to the plan.