YES, its an accounting thing. READ your contract.
In the state of Ohio, your car may be repossessed if you miss one payment. Your car may be taken any time of the day or night by the repossession company. The repossession company is not allowed to keep any items that you may have left in the car. The company must inform you as to what they are going to do with the car, including selling it, putting it in a car auction, or keeping it.
Yes. The car will be sold at a public auction and the borrowers will be responsible for any difference between the selling price and the loan balance plus the allowable repossession and other fees. The lender is legally required to make a reasonable attempt to get the fair market value of the vehicle, unfortunately this does not always happen and that sometimes leaves the borrowers with a substantial amount of debt to repay.
Peggy, the lender got a judgment against you for the Unpaid Balance after selling the car. That judgment becomes a sellable item. Agencys and attorneys and LARGE companys BUY the judgments before SOL runs out and tries to collect.However, some agencys try to collect even when its no longer possible. Verify that they are legit before you make any payment arrangemnets with them.
That is a voluntary repossession...not a good idea in the long run. The bank will wholesale the vehicle at an auto auction, apply the proceeds (less selling expenses) to the loan and you still owe the balance. Plus it goes on your credit report. If the car has a retail value in excess of the loan balance, you will be far better off selling the car yourself and paying off the loan. You still have no car...but no car payments and no bad credit report. Even if the car is worth slightly less than the loan balance, you'd come out thousands ahead if you sell it and find the rest of the money to pay off the loan.
So here is an example of what can happen when a creditor repossess an item. "If an item such as a car or furniture is repossessed, the creditor can then sell it. The money from selling the item is applied toward the money you owe. The creditor can still try to get any money you owe after the sale of the item. The terms of your contract might even add charges for the costs of repossession and sale."
Repossession of any chattel (boats, cars, anything) will adversely affect your credit, so you may not be able to establish new credit for a few years. If you promised to pay for something, and you didn't, the general answer is that the agrieved party (lender in your case) can sue to recover the amount you owe, less the amount they recover by selling the repossessed property, plus interest, fees, attorneys fees and court costs.
Most automobile financing agreements allow a creditor to repossess your car any time you're in default. No notice is required. If your car is repossessed, you may have to pay the full balance due on the loan, as well as towing and storage costs, to get it back. If you can't do this, the creditor may sell the car.If you see default approaching, you may be better off selling the car yourself and paying off the debt: You would avoid the added costs of repossession and a negative entry on your credit report.3 ways to AVOID repossession1. pay the notes2. find someone else to pay the notes3. slip the car aboard the space shuttle bound for MARSAs a repossession specalist, I can say that paying the bill is the best way to avoid repossession. If that is not possible, talk to the bank or lender. Believe it or not, they do not want your car, they want the money and will be more than willing to deal with you. They generally loose money on a repossession. 90% of the time that I receive a repossession request, the debtor is more than 65 days behind (average is 3 months)and is avoiding calls from the lender.In regards to hiding the vehicle or other technique, if the agent is worth his or her salt this will only delay not prevent repossession and may end up costing the debtor more. Once a repo is made and the vehicle is auctioned, any remaining balance is charged to the debtor. This includes the cost of the repossession. The more it cost me to do the job, the more it costs the bank and that cost is passed on to the debtor.
Sorry....just to start, repossession with all payments made? For not reason at all? Because the bank wants your old car so much they'll pay for the costs of getting it, storing it, selling it, getting the title, legal, etc...... Doesn't sound like the real story....and you ain't going to fool anyone by just insisting differently. So, if you feel you can prove differently, then someone took your car, and they couldn't have been doing it legally. May be a simple theft...it can't be a repossession. Call the cops and report it stolen. (But explain the circumstances, so they don't go running around on a goose chase).
You would owe any payments not made up until the day the car was taken. So, if you hadn't paid for two months and they took you car, you would owe those two months. The borrower would owe all back payments and penalties plus any difference in the amount of the loan and the amount for which the vehicle is sold. ___________________________________________________________ You have to take into consideration that the lender might not be able to sell the car and get enough from the sale to pay off your loan. So if there is a discrepancy between what you owe and what they sold the car for then you owe the balance. When a car has been repossessed, the purchaser is liable for any balance that remains on the car if it is sold by the lender. The balance that the lender is looking to collect will include the fees charged to them by the repossession company, storage com, and the selling agency if they do not sell the vehicle themselves. Additionally, interest will continue to accumulate on the balance until the car is sold or the original owner re-assumes it. If the car is sold for enough money to cover the balance then the original purchaser will not have to pay any past due payments. If the car sells for less than the balance due, the original purchaser will be liable for the balance and interest will continue to accrue on this.
One consideration would be that cancellation of a debt becomes income, and is taxable. But a repo isn't a cancellation of debt, it is a payment by selling the asset. However, as you can find in many discussions here, if your repossessed and the sale of the property does not return enough funds to fully satisfy the debt, the deficiency is normally not forgiven. Instead you remain owing that amount and the lender will presumably continue to try and collect it. Hence, the sale as an exchange of value isn't a cancellation of debt, and there likely isn't any even if there is a deficiency. No tax consequence.
Depends on the specific laws of where you live. In general, if the car you bought is being repossessed because you cannot pay for it any more, consider selling it to someone who can. You basically sell the car at a really low price, practically just below the amount the you already spent on it. The person who bought the car from you, then would have to continue paying for the remaining balance to the dealer from where you bought the car. This way, you're credit won't go bad.
It's much easier to prevent repossession than it is to reverse one. It seems that once the repossession is in process, it begins to take on a life of its own and it's almost impossible to stop. On the other hand, most lenders will be willing to work with you for a short amount of time if you are having problems making your payments. If you find yourself in this situation, call your lender and explain the circumstances that are preventing you from making your payments on time. They may allow you a short grace period, or may even create a new payment schedule that you can stick to. (If they do this, be sure to get it in writing!) However, always talk to the bank when they call. Do not hide behind caller ID or use voice mail. A bank that thinks you are working with them will bend their rules on repossession much more willingly if you are communicating with them on a regular basis. Generally, the bank will be looking to repo the car sometimes between when you are 30 to 60 days late on you payment. If the lender simply won't work for you, and you know that repossession is just around the corner, then you may consider turning in the car on your own. Why? Because if your car is repossessed, you will not only be responsible for the balance due after it's sold, (more on this in a moment), but also the costs involved in the repossession, such as towing and manpower. Don't think you can hide your car from the repo man forever. Repossession agencies handle hundreds to thousands of repossessions a year and are experts. They know all the tricks that borrowers use to keep their cars from being towed. Repossession If you default on your loan, the lender will have the right to come and take your car away. Depending on the state you live in, they may or may not be able to come on your property to do so, without advanced notice. They are not allowed to create a "breach of peace," while repossessing your car. In other words, they can't make a big scene and let everyone around you know that they're taking your car because you didn't make the payments! If you have personal belongings in the car, the lender will have to return them to you in good shape, or reimburse you for them should they disappear. (Again, the laws vary per state, so be sure to find out what they are in your state.) Sell Once the lender has your car, they will likely try to sell it in order to recoup at least some of the loan balance. By law, they will have to inform you when and where your car will be sold, and allow you the opportunity to buy it back. To do so, you will have to pay the entire balance due, plus any expenses associated with the repossession process. If you feel that the car wasn't sold responsibly, you have a right to dispute it. In other words, if you feel that the lender didn't try to get an honest price for the car, you should talk to an attorney about your options. Deficiency When the lender sells your car, you will be responsible for the difference between the loan balance and what the car was sold for. For example, if your loan balance (plus the fees and unpaid interest) was $10,000 and the car sold for $6,000, you would still owe $4,000 to the lender. The key here is to keep careful record of the entire repossession process. When you are in front of a judge being sued for the deficiency amount, it will be your only chance to dispute the lender's claim that you still owe them money. If you can prove that they acted wrongly in either the act of repossession, or while selling your car, the judge may dismiss that balance. You can also sometimes dismiss the balance with a bankruptcy filing.
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