Repossession
Personal Finance
Loans
Money Management

If a car is repossessed does the loan still have to be paid off?

Answer

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Wiki User
07/15/2015

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.