Getting your vehicle repossessed can ruin even the best day. Unfortunately, auto repossession is one of the risks involved with car title loans.
The good news? If you don’t want the repo man taking your vehicle, you can easily avoid it. The two most important things to remember are borrowing a manageable amount of money for your auto title loan and making your payments on time.
If you’re in danger of auto repossession, don’t worry. We’re here to give you the car repossession help you need. This article covers how to stop a car title loan repossession and what to do if your title loan payments have already gone past due.
How Do I Stop a Title Repossession?
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If you need to stop an auto title loan repossession and your account has gone to collections, the best way is to make the payments you are behind on and catch up. Debt collectors will have access to your personal information and typically call and send mail until they can successfully make contact.
Once contact has been made, you need to demonstrate the ability to repay the borrowed amount to get your name removed from their list and follow through with the payment.
If you get behind on your payments, your name will re-appear on the collectors’ lists. Contact your loan company or lenders as soon as possible to avoid landing your name on that dreaded list. Keeping in touch with them shows your willingness to make the necessary payments to avoid repossession.
If you want to get out of a title loan and avoid repossession altogether, you can also pay the balance in full.
In short, here’s what you should do to prevent the repo man from visiting your home:
- Be smart about how much you borrow.
- Communicate daily with your lender.
- If possible, repay the total amount and get out of the loan.
Communicate Daily
Communicate this challenge with your lenders if you’re in a tight place and could use some flexibility to pay off your loan amounts. In the eyes of the loan companies, consumers need to demonstrate the ability to repay the loan or at least be willing to work to pay off the loan.
If you let the company know, they will typically grant you the extra time you need. However, this time may vary. If you know, you won’t have enough funds available to pay the title back for three months, ask for a 90-day short-term extension and stick to your word. If it looks like you won’t be able to pay your monthly loan amount by that time, keep in contact so it’s not a surprise to them.
Be Smart
The best way to avoid car title loan repossession is to avoid borrowing too much money or more than you need. If you won’t have the funds by the first due date and continue making your monthly payments, you may be subject to high-interest rates if the loan ends up rolling over.
You don’t want to risk something as important as a vehicle by borrowing more than you can handle.
How Long Before Title Loan Repossession Happens?
Most lenders give their car title loan company explicitly written permission to repossess their vehicle when they sign up for their financial plan. Technically, that means a loan company may be able to seize your vehicle as soon as borrowers miss their first payment.
Typically, that’s not what happens, though. Your lender will try to get in touch with you to pay your balance in full. They may even pay you a loan visit to check in and ensure you’re not avoiding your payments.
Repossession creates more hassle for everyone involved, both lenders and borrowers. The lenders face mountains of paperwork and hours of extra work. For borrowers, it presents an unfortunate situation where, most of the time, they become responsible for the entire loan amount in one lump sum or must lose their automobile.
The borrower may still be responsible for the loan balance if the auctioned price is less than the amount owed.
If your lenders can’t get in touch with you for over a week, this is when they will typically move to remove your vehicle. For more details, you should always check your loan policy.
What Happens If TitleMax Repo Your Car?
If you benefit from a car title loan without paying your monthly premium, there’s a good chance you’ll face vehicle repossession sooner rather than later. No lenders want to have to do this, but they may not have any other choices if you stop making your monthly payments to your lenders.
When repossession typically occurs, your lenders will bring it to a tow yard after the seizure. On the bright side, you can rest assured that your vehicle will be in safekeeping while you figure out how to make the money payment your lender needs.
When you don’t make your loan payment and the car gets seized, they will sell the car and all personal items in it.
Your lender will always be willing to help you get back on track with your auto title loans, so your best bet is to call them and discuss the issues that led to the repossession in the first place.
If you cannot call and rectify the situation with your lenders, you could be facing repossession. Once that happens, it will reflect poorly on your credit report, giving you pretty bad credit, raising future interest, and limiting the amount of cash you can borrow in future scenarios.
What Do I Do If My Vehicle Has Been Repossessed?
Borrowers may not know when their lender will repossess their car. They won’t get a knock at the door, and it won’t be scheduled.
Follow these steps to protect your valuables and assets:
- If you worry that your vehicle is at risk of repossession, you should clear it of all personal effects. If you have items of financial value, you want to ensure they don’t take those from your car.
- Once you discover your car is no longer there, contact the repo company and lender. You’ll have the opportunity to attempt to re-pay your loan payment plus any interest accrued due to your failure to pay the loan.
- Make a loan payment to get your car out of repossession. Otherwise, failure to do so results in your car getting auctioned off to the highest bidder. You should contact your loan company and attempt to rectify the situation by paying the amount owed to your car.
If the car gets auctioned off and the highest bid covers your entire loan balance, you will no longer have to pay the remaining money on your balance. However, you will need to pay the difference if it sells for less than your total owed amount.
Title Loan Repossession Laws
While the laws surrounding car title loans will vary from state to state, know that they are in place to protect both the borrowers and the lender.
In California, for example, a lender can take the car as collateral as soon as the first missed payment. As we covered earlier, however, that’s not typical. Still, you can’t expect every lender to be empathetic and understanding when you’ve consistently missed your monthly premium and interest payment.
It’s common to find a lender that wants to work with borrowers to come up with payment and keep the loan current, avoiding repossession altogether. They may also try to roll over the loan, bringing an incredibly high-interest rate and APR (annual percentage rate).
Late Payment on Car Title Loans
If your car title loan becomes delinquent, it’s ultimately the lender who can decide how to proceed. Most will try to find a solution, and they will see a late payment as better than not sending any payment.
No Payment on Car Title Loans
Things are different if you fail to pay on your car title loan altogether. There’s a serious chance it could lead to repossession. Your lender may want borrowers to pay the total amount left on the car title loan, which could put the borrower in a bad financial position. Still, every lender legally has the right to call for this.
Can a Car Repossession Be Stopped? Consider Auto Refinancing
One way to avoid vehicle repossession due to failure to pay on your car title loan is refinancing. You can refinance a title loan with another lender and often reduce the interest rate and monthly payment.
Remember that your title loan approval is subject to credit checks and must meet the lender’s credit criteria to qualify. If your car has already gone to the repo and your credit has taken a hit, you may face high-interest rates on any refinanced loans as a borrower.
How much cash can I get? It depends on how much you can show your responsibility to repay a loan. The more you can prove your ability to make your payments, the less expensive your interest will be.
The main reason borrowers refinance their car title loans is to get a better APR and lower monthly payments. It may be difficult after a repossession, but it’s still possible as long as you do your part of the work.
How Do I Stop the Repo Man from Taking My Car? Car Repossession Legal Help
If you want to get out of a title loan without losing your car you might seek legal help. Schedule a consultation with a consumer or debt relief attorney to make things right with your lender and hopefully improve your credit and financial standing.
Getting caught up in a bad situation is easy, but an experienced lawyer in this field can help.
While working with an attorney might require you to pay more money up-front, there’s potential that they can help you recover your vehicle from your lender.
If you’re in default with your lender, there’s likely not much they can do. However, if the lender was in the wrong and your loan is not in default for some reason, an attorney can make things right.
Lawyers can help in a few ways:
- Raise a defense to a deficiency judgment
- Prove wrongful seizure
- Prove you were in the military
If you’re in the military, see the Military Lending Act. A lawyer can prove that a lender took the car without a court order. Also, you’ll have a debt deficiency if your car is auctioned off for less than what you owe.
If you want to avoid this deficiency judgment and get out of making that additional payment, your attorney can raise a defense to this judgment, such as a breach of the peace or an expired statute of limitations.
If you don’t want the car back, or you do want the car back, and you have the funds available to pay the debt off entirely, there’s a good chance you won’t need legal help after all. You must take swift action by calling your lender and sending them the last bit of owed money.
Use Max Cash Title Loans to Refinance Your Title Loan
Avoid getting your car seized by staying current on your monthly loan payments. However, if your current loan structure doesn’t feel financially feasible, you should look for other options.
If you are struggling to make your monthly financial payment on your car title loan, look to Max Cash Title Loans to help you refinance your loan for a more viable payment plan.
Max Cash Title Loans can help you refinance to achieve lower APR and more manageable payment amounts.
The longer you wait to act on car title loans you can’t handle, the higher your rates may get. Contact Max Cash Title Loans as soon as possible to avoid penalties.