While there are some great public transportation options in large urban areas, most people in the U.S. depend on their own cars to get around. Estimates suggest that there are approximately 1.8 vehicles per household in this country. Whether traveling to work, school, the store, the beach, the doctor, or the bank, we rely heavily on our cars.
A set of wheels is also often a key step to independence Financing or leasing a vehicle comes with rights and obligations that end once the last payment is made. Being behind on payments can cause creditors to repossess the vehicle, which may lead the debtor to be stressed, depressed and inconvenienced. In turn, it may commence a vicious cycle of the debtor not having the means to get to work to earn money to pay for the car. There are rules that must be followed for a repossession to be considered valid, and bankruptcy does offer options for keeping the vehicle.
With more than 35 years of experience in our community, the Fayette County debtor car repossession lawyers at Bunch & Brock are committed to providing each of our clients with a high level of personal service. We are dedicated to helping those in our community who are struggling with the harsh realities that may accompany being behind on bills. We understand each step necessary for filing a successful bankruptcy petition, as well as ensuring the best decisions are made based on your circumstances. If you are burdened with debt, you need the calm competence of a skilled legal team in your corner. We encourage you to contact our office by calling (859) 254-5522, emailing email@example.com, or filling out this online form.
The loan agreement is a contract between the lender and the borrower that lays out the rights and responsibilities of both parties. It explains exactly what constitutes a default under its terms, such as failure to make timely payments. Once a debtor is in default, the creditor is legally permitted to seize the vehicle without giving notice and without a court order. The creditor (or the repossession company that it hires) may take the car from a public street or from the debtor’s property. However, threats and use of physical force are not permitted, nor is removing the vehicle from an enclosed area without permission. Executing any of the above is considered a “breach of the peace,” which can result in the creditor having to pay a penalty or compensate the debtor for any damages that occurred. It can also give rise to a legal defense if the debtor is sued by the creditor to collect a deficiency judgement.
Upon repossession, the creditor may choose to keep the vehicle as compensation for the debt, or sell it to put the proceeds toward the debt. In most cases, the creditor will opt to sale, which is usually set within 10 to 20 days. It is common that the sale proceeds are not enough to pay off the debt, which includes the costs and fees of the repossession. This may leave the debtor liable for a deficiency.
The creditor is obligated to provide the debtor with notice of the sale including the date, time, and place. Prior to the sale, the debtor is permitted to negotiate to retrieve their property back. If the creditor is not open to negotiating, the debtor has the right under state law to “redeem” the vehicle by paying the balance due and certain expenses connected to the repossession. If the debtor does not redeem by the deadline, the creditor is legally allowed to proceed with selling the vehicle and is obligated to do so in a “commercially reasonable” manner. While the creditor doesn’t have to get the highest possible price, a resale price below fair market value may indicate that the sale was no commercially reasonable.
How We Can Help
Bankruptcy can temporarily stop a creditor from repossessing, and in Chapter 13 cases, allow recovery of an unsold repossessed vehicle. An attorney is able to advise you on the alternatives. If you have received notice that your creditor intends to repossess your vehicle and you can’t afford to pay the balance due, a Chapter 13 bankruptcy attorney can modify the original agreement and reduce your payments in a Chapter 13 Plan. If the creditor wrongfully repossessed your property, used force, sent an improper notice of resale, or accepted a resale price that was outrageously low, consult a lawyer. If you have been sued by the loan company for a deficiency judgement, have an attorney review your case. If you are facing bankruptcy or are already in bankruptcy, speak to an attorney for information about your rights to the vehicle during the process.
Each situation has a unique set of facts, and if yours involves repossession of your vehicle, discuss your legal options by consulting with the Lexington, Kentucky vehicle seizure lawyers at Bunch & Brock. For more detailed information, call (859) 254-5522, email firstname.lastname@example.org, or fill out this online form. You can rely on us for accurate, honest case analysis and dedicated representation. We have helped many individuals get the relief they deserve given their personal set of circumstances, and we can help you.