Los Angeles Repossession Lawyers
Avoiding Vehicle Repossession & Foreclosure
If you live in Los Angeles, chances are you know just how important it is to have a car. But what if that car was repossessed? How would you get around? How would you get to your job? And what can you do if you’re facing repossession? If your lender is threatening repossession because you are behind on your car loan, or if you are late with your mortgage and concerned about foreclosure, you may be able to find relief through bankruptcy.
At Resnik Hayes Moradi LLP, we take pride in helping clients throughout Southern California keep the property they worked so hard to obtain. By filing Chapter 7 or Chapter 13 bankruptcy, you can put an immediate stop to repossession and foreclosure actions. Our attorneys welcome the opportunity to meet with you during a 30-minute risk-free consultation and explain how the bankruptcy process works.
Contact our car repossession attorneys in Los Angeles today to schedule your appointment.
What is Repossession?
Repossession is when a creditor decides to take your property without first suing you. The main form of repossession is car repossession, but many other things can be repossessed, including household appliances, large screen TVs, or any other item of your property that can serve as security for a loan
This property will serve as collateral for the loan or other debt that you owe to the creditor. Typically, defaulting on a loan means that you have not made your monthly payments in full and on time. But you can also default on your loan if you do not maintain other areas of your property. For example, you do not maintain insurance coverage on a car you financed.
There are strict rules that cover what and what cannot be repossessed by a creditor if you default on a loan.
What Can Be Repossessed?
A number of things can be repossessed if you default on a loan, including:
- Your home. When your home is repossessed it is called a foreclosure. This is when you default on your home loan and cannot make your mortgage payments. The lender evicts you and then sells the property in order to recover as much of the outstanding loan as possible.
- Your car. Most auto loans allow a creditor to repossess the car if you do not pay the loan and default on payments. The car is then sold to help the lender recover the money. There are a number of things that can be done in this situation. Read on to learn about your options.
- Rent-to-own items. These items include: furniture, electronics, appliances, and anything else you rent with the option of purchasing.
- Any property used as collateral. A debt is secured can be secured by offering up another piece of property (called collateral) as a guarantee of repayment of the debt. If the debt is not repaid, then a creditor is allowed to take that property through repossession.
A credit agreement will detail what “default” on that specific loan means. This can be for a number of things, including being behind on payments or not maintaining proper insurance, as with a car.
Options to Get Your Car Back
If your car has been repossessed as collateral, and you want it back, there are several options you can employ. Here are those options:
- Paying off the loan (redemption): The bets way you can ensure you’ll get your car back is by paying off the loan. This is called exercising your right of redemption. To fully “redeem” your loam, you will be required to pay back the entire balance of the loan, in addition to certain fees and costs (such as repossession and storage fees). The bank or creditor is required to send you written notice that has all the information about how to redeem the possession, such as the telephone number for you to call to find out the exact payoff amount and how to make the payment. You are able to redeem the car at any time prior to the private sale or bank auction. If you don’t receive the notification within five days of your property being repossessed, you should contact the creditor or bank right away to get the payoff amount in addition to instructions for how to redeem your property. Your right to redemption ends when the property is sold.
- Reinstating the loan: If it’s allowed in your state or by contract, you are able to redeem the car or reinstate the loan.
- Buy back the vehicle at a public auction: If your car is to be sold at public auction you are able to attend the auction and bid on it yourself. The bank is required to give you notice of the public auction your car will be sold at.
- Negotiate with the bank: Work with a repossession lawyer to negotiate with the creditor to get the car back. This can involve negotiating a partial reinstatement, new payment plan, or refinancing a loan. While you are not required to use a lawyer, it is advised, as they will be able to build your case for why you should be able to get the car back. Most repossession lawyers also offer payment plans for their services.
Regardless of what decision you make, you will need to act quickly. If a debtor has repossessed your car, van, truck, motorcycle, or other vehicle or piece of personal property, and you want it back, you’ll need to act quickly. That being said, it’s important that you understand the idea of “reasonable time.” A lender is required to give you “reasonable time” to exercise any of the above options before it sells your possession. If you do not take action within this “reasonable time” period, you’ll lose the opportunity to get back your possessions.
Bankruptcy Can Protect Your Car & House
When you file bankruptcy, an automatic stay goes into effect. This instantly halts any repossession or foreclosure actions, giving you some breathing room to figure out your next move.
- If you file Chapter 7 bankruptcy, your unsecured debts are discharged, freeing up money to pay your car loan or mortgage.
- If you file Chapter 13 bankruptcy, you are able to repay the past due amount over a period of three to five years, without incurring penalties.
The Bankruptcy Code also allows for other actions that can help you keep your property. With a Chapter 13 bankruptcy, you can eliminate a second mortgageif the value of your home is less than the value of the original mortgage. In certain situations, you can lower the balance of your car loan to the vehicle’s current value and extend the length of the loan, making the payments more manageable. With Chapter 13 bankruptcy, you can immediately begin a repayment plan which is often lower than your current auto payment by reducing the car to fair market value.
Were Your Rights Violated During Repossession?
If you believe the bank violated your rights during the repossession, such as not informing you properly and with enough notice, or by breaching the peace, you can use this as bargaining leverage to get the car or property back. You’ll want to contact a lawyer to advise you on your legal rights when it comes to repossession. Make sure you record all the dates and times – specifically when you received notices, calls, etc. This information will help a lawyer build your case and potentially get your car or other possessions back.
Take Action to Stop Repossession & Foreclosure
Being proactive in this situation can mean the difference between getting your belongings back and losing it to repossession. If more than five days have passed since the property has been repossessed and you still haven’t received a notice from the bank or creditor, do not wait any longer.
The earlier you act to protect your property, the better position you are in to avoid repossession and foreclosure. Speak with an experienced Los Angeles bankruptcy lawyer to learn what you can do to fight the car repossession and retain what you have worked so hard to purchase. Se habla español.
Call us at (213) 344-0043 today to find out how you can protect your property.
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