At the time of signing an auto loan contract, borrowers give the right to lenders to recover dues in full. In case, they fail to fulfill their obligations, loan dealers will exercise the right by repossessing cars with or without warnings to borrowers for recovering loan dues. Such a prerogative might not require any court procedure. Lenders may even sell the vehicles by arranging an auction for achieving their goal of getting back the money lent. However, from the borrower's perspective, such occurrences can be prevented by knowing how exactly the car repossession process works and how they can keep cars.
Lenders repossess cars arise when a borrower misses monthly payments and fail to elicit favorable responses from borrowers. When a vehicle is financed under a loan agreement, the lender has total rights over the car title until the dues are paid off completely. To that effect, if the borrower defaults on car installments, car repossession becomes a probability.
In a typical process for repossessing cars, lenders seize vehicles and while doing so, they may not even be required to inform the borrowers. In the meanwhile, the borrower does have the chance to get back the car that has been repossessed. If all actions do not bring results then the lender will sell the car.
You can think of redeeming the car by paying off all the loan dues along with repossession costs before your lender taking any action to sell the vehicle. That is possibly the best course of action to be followed.
In case, you are unable to repay missed payments or the unpaid balance then you can contact your lender for working out a negotiated arrangement that is strictly between you and your creditor. This might help you to keep a car.
If all actions fail, it could be advisable to consult a bankruptcy attorney. You can consider filing chapter 7 or chapter 13 bankruptcies, some states allow debtors to retain cars or the court may ask creditors to modify the terms of the loan.
The entire task of dealing with car repossession could be a highly complicated process. You must get legal advice to learn about your rights or get assisted by an expert.
Get the Car You've Always Wanted Regardless of Your Credit Get Pre-Qualified