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What to Do after a Car Repossession


Car repossessions rarely strike like a bolt out of the blue. After all, you must know that you have been missing payments. Nevertheless, finding out that your lender has repossessed your car is certainly a shocking experience.

Car repossessions occur when borrowers do not pay their car loans. Because the loan is backed by the car acting as collateral, the lender can seize the car when you default. Here’s what to do after a car repossession.

Document any Damage

A repo man cannot breach the peace or cause damage or injury while repossessing the car. For example, he cannot bust into your garage, breaking down the door to get at your vehicle, and he also should not damage the car. If you notice any property damage, then document it with your smart phone.

If the repo man confronted you and threatened you, then find witnesses and write down your memories of the confrontation.  Threats are also a serious offense.

This evidence can be helpful later. If the repo man caused damage, then you might be able to get compensation to fix the damage or not pay back any money that you owe the lender.

Contact Your Lender

You need to talk to the lender because you are entitled to get back any personal belongings that were in the car at the time it was repossessed. Your lender should tell you the location and date where you can get your stuff.

Consider Your Options

After repossessing your car, the lender might try to sell it quickly. You should receive a notice of sale, which should include the date when the car will be sold (typically at auction).

If you suddenly find yourself flush with cash, you might be able to get your car back. You can discuss your options with the lender, such as redemption, where you pay back all the money owed, including any expenses incurred to repossess the vehicle. Unfortunately, few people have the money to pay off the remaining balance on their loans, but this might be an option if you were very close to paying off your loan.

Analyze Whether You Owe a Deficiency

Cars are often worth less than the outstanding balance on a car loan. For this reason, you should not be surprised if the lender sells the car for less than what you owe, resulting in a deficiency.

For example, you might have $5,000 left on the loan. If the car is sold for $2,000, then a $3,000 deficiency remains, and your lender can sue you to recover any deficiency. However, realize that under Florida law, your lender cannot sue for a deficiency if the remaining balance on your loan is under $2,000.

Car Repossession and Bankruptcy

The bankruptcy code’s automatic stay can temporarily halt any repossession activity, giving you some time to figure out a game plan. Also, a Chapter 13 will give you more time to catch up on your late payments—three to five years to be exact.

At Nowack & Olson, we help indebted creditors manage their debts. To speak with one of our Plantation car repossession lawyers, please call 866-907-2970.



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