Car loan default: What, when and how?

When the economy slumps unemployment percentages, grim job prospects, and high inflation rates can rock any individual's boat. Those who once had a great credit score and made payment of bills on time could now face the fear of defaulting on their loans.

Probably the next big thing on your monthly budgets after the mortgage loan is the car loan. And you would not want to default on this for obvious reasons. One, it will destroy your credit history and two you might lose your car to the repo man!

But when does a default actually happen? Does making a deferred or skipping the payment for a month or so constitute a default? Will your car be repossessed then?