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Collateral on a contract can work as follows:
The collateral will serve the same as actual payment if payment is not rendered at the end of the contract. Depending on the contractual agreement, the collateral may be held until the debt is satisfied or seized altogether.
Check your state laws in reference to Collateral Contracts.
Collateral can be offered as 'cash' for a contract. Be careful of this however, if the collateral is appraised at a higher value than that of the contract, you may be liable to surrender the balance of value. If it is appraised to be lower than the contract value, then you will take a loss.
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What is a Collateral Contract?
A collateral contract is a contract which assigns the rights and/or obligations of an existing contract to a third party. Due to the doctrine of "privacy of contract" only those parties mentioned in a contract have rights and obligations and it is illegal to assign these rights and obligations to third parties without the consent of the other parties to the main contract. Collateral contracts overcome the privacy of contract doctrine. Collateral contracts are used in the construction industry to make a direct contractual relationship between clients and sub-contractors. In the collateral contract the client will promise to pay the sub-contractor for the works that the main contractor promised the client to undertake. This collateral contract comes in handy when the main contractor goes insolvent or has late payments or, more importantly, when the subcontractor's performance is substandard.
What circumstances other than overdue payment permit a creditor to repossess collateral?
The answer to this question depends on your contract terms. Usually, a contract will spell out what constitutes a default. The contract should also say that if you default, they can repossess the collateral.
Can your car be repossessed in Missouri if you are making payments but 45 days behind?
READ your CONTRACT. Its that simple. If you are in DEFAULT of the contract, they can repo the collateral.
Can a vehicle be repossessed if the payment is 21 days late in New York State?
READ your CONTRACT. IF the contract is in DEFAULT, the collateral CAN be repossessed.
Are you responsible for the balance of a loan after the collateral is voluntarily repossessed and auctioned?
YES, read your contract.
Can they repossess your car the day after they receive a partial payment?
As long as you are in DEFAULT of the contract, the lender can repo the collateral.
What does surrendering collateral to a secured creditor mean?
It means giving up the stuff you put up to get the loan in the first place. It means giving up the collateral before the creditor comes for it. Or of course, it means giving up the collateral before there is a legal fight about it. Depending on the state and the contract you agreed to before you put up to get, surrendering collateral before litigation (going to court) might help avoid some further legal problems. Not always. Sometimes creditors want to go after the entire debt, not just what you paid off with the collateral, and your really nice attitude. Check your contract. Your debt begins and ends with the contract. If you dont have a copy, you better get one. NEVER, NEVER, NEVER dont keep your contract when you borrow money!
How far do you have to be behind on your payments to legally repo in Michigan?
Legally, ONE day. As long as you are in DEFAULT of your contract, the lender CAN repo the collateral. Read the contract for more on DEFAULT.
If a car payment is due on the 14 but a payment will not be made until the 29 can the dealer repossess the car in Georgia?
YES, if you are in default of the contract, the collateral can be repossessed. Read your contract again.
How long can you be late on car payments before they can repo?
Read your contract. One day. As long as you are in default of the contract, the lender can repo the collateral. That could include no ins. coverage.
In a contract signed by both parties states that you have the right to the title of a car for collateral. The other party does not pay back the loan. Can you put a lien to that car?
No you have to sue, but you will almost certainly win if the contract is legal. You might even find a lawyer to work off percentage if you plan to sell the car.
Can a creditor reposses your vehicle if you have the automobile and the title?
Yes, IF the lender has a contract specifing the car as collateral for the loan. Once you use the car for collateral, all the titles in the world wont stop the repo if you default the loan.
