Fix Auto Ontario

My Car Got Repossessed! What Should I Do?

Unfortunately, one of the realities of owning a car is repossession. If you fall behind on payments or default on your loan or lease, your car can be taken away from you. It can be a nerve-wracking experience, and you're sure to have some questions, like where is my car? Am I able to retrieve it? How am I going to get to work?

Here are some important points to know in case you find yourself in this situation, brought to you by all of us at Fix Auto Ontario in Ontario, CA:

Why was my vehicle repossessed? 

If you don’t pay your bills in a timely manner or don’t have insurance, your car can be repossessed, often without any notice. Depending on the particular state you live in, you also might want to check that your insurance is stipulated in your lease, contract or loan. Otherwise, you could be considered in default.

Where is my vehicle?

After your car is repossessed, the creditor may sell it through a public auction or private sale, or keep it as compensation to pay off the debt. In some states, they are required to tell you what happened to your vehicle, including when and where it was sold and for how much money.

How do I retrieve it?

Find out if you can pay back the loan and repossession costs so you can get your car back before it is sold. By reinstating your loan, you can then structure a payment plan that you can afford. The downside is that it will be added to your credit report and can stay there for up to seven years. If you are considering bankruptcy, you are often able to keep your vehicle.

Who do I contact about personal belongings?

Even if your car was repossessed, you still have the right to all your personal property. The lender or repo agency should let you know how they are going to return your belongings. If they don’t tell you, make sure to ask or consider talking to an attorney. 

What should I be aware of now?

Once your car is sold, money could still be owed on the vehicle so you’ll want to find out if there is a balance left. If you think the car was sold for less than the fair market value, there might be what is called a “deficiency balance” and you may have a claim against your creditor. 

Make sure the account wasn’t sent to collection, and if it was that you pay the balance, or you could be sued. Many people in this situation pay off the amount owed so it doesn’t affect their credit report. 

Whenever possible, make every effort to prevent having your vehicle repossessed by talking to your creditor, especially if you think you’ll have a late payment. It’s always easier to be proactive rather than to dispute it later.

Sources: LegalZoom, Wikipedia and USA Today