I worked in collections (auto loans) a couple decades ago. Here is what happens 1) they take the tractor from you, and it goes to your credit report 2) they have to hire someone to repo and store the tractor, these fees are added to your loan amount 3) they sell that tractor at auction 4) you still owe any difference between the loan amount + the fees, and the selling price at auction. So, say you owe 10K, and they have 3K in fees, so your owing amount is now 13K, (and yes the fees are that high, so by turning the tractor in, you can save on some fees), the tractor sells at auction for 8K, you still owe 5K. If you don't pay it, it is written off and you are 1099'd on it, so it is listed as income to you, so then, the paperwork is sent to the IRS, and you will get a 1099 early next year from the bank.
Lot of good advice on here already, with the best talking to the lender 1st.