Communication With Your Lender Is Key
It is a good idea to talk to your lender first if you are having trouble making your payments because you may be able to work something out (like a temporary lower interest rate or tacking overdue payments onto the end of the loan repayment period) before risking car repossession.
Car Repossession Laws?
Each state has its own set of laws and rules that govern car repossession; however the rules are similar no matter where you live. Once you finance or lease a car, your car lender has certain rights and remedies that come with the contract you sign. One remedy allows the lender to repossess your car if you default under the terms of your agreement. Your contract will specify what exactly constitutes a default but common examples include failing to make your payments or not having car insurance.
In many states, if you are in default, the lender can repossess your car without giving you any notice. However, when repossessing the car the lender cannot commit a “breach of the peace.” This usually means that the people sent by the lender to get the car cannot use force against you, threaten force against you, or go into your closed garage. But for example, if your car was sitting in a parking lot and you were not there to object, then the lender is free to repossess it without giving you any notice as long as there is no breach of the peace.
Can I Get My Car Back or Reinstate the Contract?
You will usually have the right to “redeem” the car by paying the full amount you owe plus any costs of repossession. In some states, you can also get your car back by “reinstating” your loan by paying off any amounts you were behind and the repossession costs. But you will still have to continue making timely regular payments in the future if you wish to keep the car.
If you’re facing a lot of debt, and are considering bankruptcy, you may have more options to get your car back. We can help contact us today.
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