Can You Get Your Car Back After Repossession?

After a car repossession, there are legal avenues to reclaim your vehicle. Understanding these options and acting swiftly is important. This article clarifies procedures for getting your car back.

Key Information After Repossession

After a vehicle repossession, the lender provides a formal notice detailing important information. This notice outlines your rights, including the ability to reinstate the loan or redeem the vehicle, and may specify the date, time, and location of the vehicle’s potential sale. Read this document carefully for details.

Two primary methods exist for regaining possession of a repossessed vehicle: reinstatement and redemption. Reinstatement involves paying all overdue amounts, including past-due payments, late fees, and any repossession-related costs such as towing and storage fees, to bring the loan current. This option allows you to resume your original loan agreement as if the default had not occurred.

Conversely, redemption means paying the entire outstanding loan balance, along with all associated repossession and storage fees, to regain full ownership. This option effectively pays off the loan in its entirety. To proceed with either option, contact your lender promptly to obtain an exact, itemized quote for the amount required for either reinstatement or full payoff. Gathering original loan documents, payment history, and the repossession notice will also be helpful.

Steps to Reclaim Your Vehicle Through Reinstatement

If you decide to pursue reinstatement, contact your lender immediately to request a detailed reinstatement quote in writing. This quote specifies the amount needed, covering missed payments, accrued interest, late fees, and lender costs for repossession, such as towing and storage fees. Lenders provide this quote with a limited timeframe, often 10 to 15 days, within which the payment must be made.

Once you have the exact reinstatement figure, make the full payment within the specified period. Acceptable payment methods often include certified checks or wire transfers; obtain a receipt. After the payment is confirmed and processed by the lender, coordinate with them or the repossession company to arrange for vehicle pickup. Upon successful reinstatement, resume regular monthly payments on time to avoid future repossession.

Steps to Reclaim Your Vehicle Through Redemption

To redeem your vehicle, pay the full outstanding loan balance, plus all charges and fees associated with the repossession. Obtain a precise, itemized redemption amount from your lender, which will include the remaining principal, any accrued interest, late payment penalties, and all repossession and storage costs. This comprehensive figure represents the total amount needed to clear the debt and regain ownership.

Securing funds for redemption may involve personal savings, a new loan, or borrowing from family or friends. Once the funds are secured, the full payment must be made to the lender, typically via methods like a cashier’s check or wire transfer. After the full payment is processed, the lender will release the vehicle’s title or provide a lien release, confirming your full ownership. You can then make arrangements to retrieve your vehicle.

Outcomes If You Do Not Reclaim Your Vehicle

If a repossessed vehicle is not reclaimed through either reinstatement or redemption, the lender will sell it to recover their losses. This sale typically occurs through public auctions or private sales. The lender is required to provide a notice of sale, which may include the date, time, and location of a public auction, allowing you to bid on the vehicle.

Sale proceeds first cover lender costs, including repossession, storage, and sale expenses like auction and attorney fees. Any remaining funds are then applied to the outstanding loan balance. If the sale proceeds do not fully cover the loan balance and all associated costs, you will be responsible for the remaining amount, known as a “deficiency balance.” Lenders may pursue collection through various means, including collection agencies or legal action such as lawsuits, which could lead to wage garnishment.

In rare instances, if the vehicle sells for more than the outstanding loan balance and all related fees, a “surplus” may result, which you are entitled to receive. Repossession and any unpaid debt or judgments will negatively impact your credit score. This negative mark can remain on your credit report for up to seven years, affecting your ability to secure future financing or credit.