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Understanding Auto Repossession

Auto Repossession Can Happen to Anyone

Minimize Your Losses by Speaking to a Lawyer

Auto repossession can happen to anyone, despite their best intentions. Not only are repossessions very common, but when the economy is suffering, car repossessions tend to rise accordingly. Aside from people defaulting on their auto loans, there are other causes that can lead to repossession, and sometimes the buyer has their own claims.

Whether the seller sold a lemon or violated the law in another manner, the buyer may have legal remedies against repossession.

Once you are informed of your rights, you might learn that you can do something about the situation and turn things around in your favor. With repossessions, creditors appear to have the upper hand, and many people have no idea that their claims may be a valid defense until they have a lawyer evaluate the circumstances surrounding the purchase and review all paperwork in detail. At the very least, consulting an attorney can minimize your losses and any harm to your credit report.

Fight Back Against Repossession by Knowing Your Rights

When faced with the possibility of repossession, you may have legally enforceable rights. Under state and federal laws, the creditor is considered to be responsible for the seller's wrongdoing.

If the vehicle was somehow defective, or if the seller misrepresented an important fact about the vehicle, then the contract may not be legally enforceable, the creditor may not be able to repossess the car, and the bank may be held responsible for compensating the buyer for any harm caused by the seller's misrepresentation or wrongdoing. If you are facing repossession or if your vehicle has been repossessed, it is important to know your rights!

What is a repossessor prohibited from doing?

In the past repossessors were quite colorful when it came to their methods for repossessing vehicles, and it's not uncommon for a rogue repossessor to abuse his power on occasion. Creditors cannot breach the peace when they are repossessing your car. They are not allowed to enter your home or your garage, nor can they stay on your property without your permission.

They cannot threaten you verbally or physically, and they cannot insult or disrespect you in any way. If the repossessor uses force, offensive language, threaten to or call the police, damage your vehicle or disclose information about the repossession to anyone such as your neighbors, then you may have a valid case to pursue a lawsuit against the repossessor and the bank.

Can I tell the repossessor to leave?

People often feel vulnerable and defenseless when the repossessor shows up on their doorstep. Before the repossessor takes possession of your vehicle, you can tell them to stop what they are doing and leave; this is true whether the vehicle is parked in front of your house or in your driveway. If they continue despite your demands for them to leave, they are breaching the peace and breaking the law.

You may want to take advantage of this right if you intend to keep your vehicle and catch up on the payments in the near future. Otherwise, be aware that if they haul your vehicle away, your debt will increase by several hundreds of dollars for the costs and fees associated with the repossession.

What is voluntary repossession?

A voluntary repossession occurs when you hand over your car voluntarily, often times this can occur when the debtor calls the creditor and tells them to come and pick up the vehicle.

While this sounds "nicer," be forewarned that you still owe your creditor money and the repossession will still appear on your credit report. If the creditor promises that you won't owe them anything or that the repossession won't show up on your credit report, make sure you get these promises in writing.

What if I worked out a new arrangement?

If you worked out a new arrangement with the creditor and the creditor agreed to accept your late payment or to change your payment due date, then the terms of your original contract won't apply any longer.

Whether these changes were made orally, in writing, or simply by the creditor accepting your late payment, the creditor cannot accept your payment and agree not to repossess your vehicle and then go ahead and do it anyway. If this has happened, contact an attorney immediately.

What are my rights to notice?

The seller is not required to give you any prior notice before repossessing your vehicle. However, within 15 days of the impending resale date, a notice must be sent out to you providing the location of the vehicle, any rights to reinstate the contract, an itemized statement of what you owe, and a list and the location of any personal property that was contained in the vehicle (property must be kept for 30 days).

Will I still owe money after my vehicle is repossessed?

After your vehicle is repossessed, the creditor will turn around and resell the car, often times at an auction and for less than what you owe.

While the sale price will be applied to your overall balance, you could still owe thousands of dollars to the creditor, and you will be responsible for this balance plus the repossession and reselling charges. Before the car is sold you may be able to reinstate the contract by paying the balance or the overdue amount, in addition to other applicable charges.

Contact a Philadelphia debt collection defense attorney from our firm today to find out how you can fight auto repossession!

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