Repossession is the act of seizing collateral that secures a lien after a person defaults on the loan. The most common reason for repossession is the nonpayment of the loan. Therefore, if you fall behind on your car loan payments, the lender may repossess the vehicle. Our Scottsdale repossession attorneys can help you explore ways to keep your car if you are behind on the payments.
Does a Lender Need to Obtain a Court Order to Repossess My Car in Scottsdale?
It is a common misconception that a lender cannot repossess a vehicle until the lender files a lawsuit and obtains a court order. That is not the case. If you default on the terms of the car loan, the lender has the right to repossess the car. However, it must follow the rules for a peaceful repossession.
The lender must notify you of the right to cure the default and that a failure to cure the default will result in repossession. A simple letter mailed to your last known mailing address typically satisfies this requirement.
The lender may then hire a repo company to repossess your vehicle. The repossession must be “peaceful” if the repo company does not have a court order. A peaceful repossession means that the company did not breach the peace when taking the car.
You can prevent the repo company from taking the car by merely stating that the company cannot take the car. If the company continues with the repo, the company is breaking the peace. Unfortunately, most people do not understand this requirement. Therefore, the repo company personnel bully a person into allowing them to take the vehicle without a court order.
The requirement for a “peaceful” repossession is the reason that many repossessions occur at night or while the person is not at home. If there is no one to say “stop,” the repo company can take the car.
Repossession companies are not allowed to break the law. They are not supposed to enter a garage or locked fence. However, repossession companies have many tricks to get cars when people are trying to avoid repossession.
What Should I Do If I Am Behind On My Car Payments?
You can stop the repossession by catching up on your car loan payments. Some lenders might work with people by allowing them to refinance the loan or pay an extra amount each month until the loan is current.
However, if your car lender refuses to work with you, you can secure your car in a safe place and talk to a Scottsdale repossession attorney about ways to keep your car.
Filing a Chapter 13 bankruptcy in Scottsdale may be the best way for you to keep your car. Filing bankruptcy stops repossession. If your car is repossessed, you may be able to get it back by filing a Chapter 13 case within 10 days of the repossession date. However, it is better to talk to a lawyer as soon as you fall behind on your car loan payments instead of waiting until the lender repossesses the car.
In a Chapter 13 case, you can stretch out the car loan payments over 60 months. Depending on how much you owe on the car, the car’s value, and how long you have owned the vehicle, you may be able to “cram down” the secured lien. When you “cram down” a lien, you lower the amount you owe on the car to release the lender’s lien on the vehicle.
Call Our Scottsdale Repossession Attorneys for a Free Case Review
If you are about to lose your car, do not wait to contact our office. Call today to talk to an attorney. Contact Allegiant Law Group by calling 602-562-1000 to schedule your free consultation with a Scottsdale repossession lawyer.