When your car is repossessed, you could feel trapped in a situation that has many legal ramifications.
Repossession Laws For Automobile Owners. Understanding Repossession Laws & Your Rights.
How Does Reposession Work?
Repossession begins with default on the requirements of the bank auto loan or dealer auto loan that was signed at the time of the purchase of the car. Failing to make payment, as per schedule even by a day, gives the creditor the legal right to repossess. This is in accordance with Repossession Laws.
Failure to maintain insurance coverage given in the loan agreement gives the creditor the legal right to repossess. . If you can get the original creditor to agree to modify these terms to avoid repossession, you can get it in writing
Is The Creditor Required to Inform Me of Their Intent to Repossess?
What is Voluntary Repossession?
You may choose to voluntarily repossess, taking the car to the creditor. This can keep you from being charged for the expenditures incurred during repossession in the future. It’s a bad idea to hide the car or attempt to secure it from the repo men. As this is likely against the law in your state.
At this time you can approach the creditor with an offer to reinstate your ownership of the car. Once the situation has gotten this far, you might have to make a lump-sum payment of the loan. To do this, you can contact a third-party credit firm to get one of the many readily available bad credit car loans.
What Happens After They Repossess My Car?
The creditor may then attempt to sell the car. Depending on your state laws, the creditor may or may not inform you of the site and the time of the sale. If you get information, you could get a bad credit car loan and try to buy your own car back..
The creditor must attempt to sell the car in a commercially reasonable manner. This means that they must honestly try to get a fair offer on the car. This stops the original creditor from simply dumping the car and then suing you for the loan balance.
After the sale, the original creditor must determine the overall gain made from the sale minus the costs of repossession. Not surprisingly, this almost always comes out showing that the creditor still has not made up its money. They will seek and get a deficiency judgment against you. And they can sue you for the balance. This would be a comprehensive pursuit of a debt you owe. You can also pursue this as wage garnishment.
What are My rights within the Car Reposession Laws?
- You can ask to modify the terms of the original loan agreement. The creditor may choose not to accept this.
- You may get a new credit car loan from a third party and ask to reinstate ownership. The creditor technically does not need to accept this, but would be foolish to turn it down.
- You may get a new credit car loan and attempt to buy your own car back at auction, if you are informed of the time and place of the auction.
- If the creditor actually made money on the sale of your car, they owe you the profits.
- You can watch the original creditor carefully and insure that they have properly followed the legal requirements of your state. If they make a mistake, they will likely owe damages and may even forfeit some of their rights.
- You can file Chapter 13 bankruptcy. This can force them to give you back your car even if they have already taken it.
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