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Can a finance company take your car away from you for not making the monthly payment?
When you borrow money to buy a car—or if you lease a car—you don’t own the vehicle “free and clear.” You get to drive the car, but your lender can take it away through repossession if you stop making payments.
Can a financed car be repossessed?
Here’s what you need to know about California repossession laws. As soon as you default on the loan, a lender may repossess your car in California. If you’re having issues handling your car loan or other debt, bankruptcy might be a good option for you.
Can a lender repossess a car without notice?
When you finance or lease a car, you normally give the lender a security interest in the vehicle. Every state has its own rules regarding repossession, but having a security interest generally means your lender can repossess the car without notice if you default on the loan.
What happens to the balance on a car when it is repossessed?
Having your car repossessed doesn’t get you off the hook for your obligation to pay the entire balance of the loan. If the proceeds from the sale of the vehicle are not enough to cover the balance of your loan, the remaining portion is called the deficiency balance.
Where can I find information on repossession of a car?
The National Consumer Law Center (NCLC) website is also a good source of information on consumer matters, including debt collection limitations during the coronavirus outbreak. If you fail to make your car payments or otherwise default on your loan, you risk having your car repossessed by your lender.
Can a creditor use physical force to repossess a car?
That is, the creditor can’t use or threaten to use physical force against you to repossess the property. If the creditor or its agent breaches the peace during a repossession, like by pushing you aside and breaking into your locked garage to repossess your vehicle, you can file a lawsuit against that creditor.