You will probably want to stop car repossession if you have defaulted on your vehicle loan. If you stop making car payments, your financing company will repo your vehicle. No joke.
Vehicle finance agreements are usually rock solid, and the finance company has all the power. Car repossession can happen without advance warning and without going to court. The finance company will take every measure necessary to repossess your car. They call it “securing the collateral.”
Lee Legal can assist you if you are facing repossession.
The Repossession Process
Once your car is repossessed, your creditor will sell the car at auction. Usually, the vehicle sells for a dramatically reduced price. Laws require creditors to ask for a fair price for a car, but a fair price is not the market price. You will owe the difference between the car note and the auction price. The auction will take place quickly, typically about 10 days after repossession.
Once the car is auctioned off, the car company will sue you for the balance. Losing your vehicle is tough. But owing even more on a vehicle you no longer own can be devastating.
If your creditor sues you, the court will notify you of a hearing date. Once you receive notice, you should immediately contact a knowledgeable car repossession defense attorney.
Repossession Can Be Costly
The repo truck man may be working off outdated information. Or a finance company representative may not have correctly entered information from a recent call. Some repo companies even charge borrowers for the cost of retaining the personal property removed from the car at the time of the repo. Every car repossession compound charges a daily “storage fee” (or lot fee or impound fee) for every day the vehicle is parked in their lot.
Even if there was some mistake, repossession of your vehicle can be expensive to you. The headache, inconvenience and costs often come altogether at the worst time.
The best way to prevent repossession of a car is to stop it before it happens. But if a repossession does happen, you should act quickly to minimize the damage.
Stop Car Repossession
In many cases, we can negotiate alternative arrangements for repayment on a delinquent loan. Negotiation prior to car repossession usually produces the best outcomes.
If the car repossession has already happened, a Chapter 7 bankruptcy can eliminate the debt you owe for the deficiency or judgment.
But if you still have possession of the car, stop car repossession before it happens. Chapter 13 bankruptcy automatically stops certain creditor actions, and that includes repossession. The bankruptcy will legally “stay” your creditor from seizing the vehicle. We may also be able to use Chapter 13 bankruptcy to restructure your vehicle loan and propose a more manageable repayment schedule.