Auto Repo(Repossesion)?

[Clever]

I was at my buddies house over the weekend and we saw his neighbor's car being towed, while him and his gf stood by the door looking really upset, later on we find out his car got repo'd by the bank for missing car payments for the last few months. He said that me made partial payment on it since he was struggling with finances but they still went ahead and did it. So my question is do they even give you a warning when they repo your car? Can you get it back by making payments? We know that they work and go to school and that car was their main form of transportation, I felt really bad but I didn't know what to tell them.

Anyone know how this works?

[Redlyne_mr2]

Banks do not want to have to reposess a persons vehicle , they take a huge loss when this happens. However legally speaking they are able to reposess a vehicle even if the person is $1 dollar past due. Now from an PR perspective this would never happen so usually the most they'll let a person get behind is 3-4 months (much less if its a subprime lender aka high risk, high interest lender). If they have reposessed your neighbours car its because the bank feels they were a sinking ship and the arrangements that were made just aren't sufficient.

In order to get the vehicle back the bank will more than likely make them pay the full arrears (back payments), bailiff costs, proof or reg and insurance, possibly more personal references and they will be watched closely to make sure they dont fall behind again. Sorry to hear about their luck

Oh and as for warnings there is always a written final demand mailed out before the repo goes down.

[Clever]

Interesting.


He never received a final written demand or so he said, he did say that he spoke to the bank a few times. Someone told me that repo's are the last resort, like you said, they loose money on it, but also that they can auction the car and sue you for the difference, is that even true? Is this final demand a payment on the vehicle?

I feel bad because they are a really nice, hard working couple that just had a tough last few months.

[Redlyne_mr2]

Originally posted by Clever
Interesting.


He never received a final written demand or so he said, he did say that he spoke to the bank a few times. Someone told me that repo's are the last resort, like you said, they loose money on it, but also that they can auction the car and sue you for the difference, is that even true? Is this final demand a payment on the vehicle?

I feel bad because they are a really nice, hard working couple that just had a tough last few months.

The financial instituation has to issue a final deman however it is up to the customer to make sure that the bank has the correct address, info etc who knows where that letter ended up. The demand is always for the full amount of the payments outstanding. They now have anywhere from 2 weeks - 1 month (longest Ive seen) to redeem the vehicle if they do not redeem it then the vehicle will be sold at auction. Now since auction sale prices are much much lower Im sure there will be a difference between what they owe and what the bank gets for the vehicle at auction. The deficiency will then be sent to a recovery department to try and collect the balance owed. If its a huge amount and they are worth sueing then they might get sued, wages garnished or even have a lien put on their house. They are able to make arrangements with the recoveries department to make payments on the balance so that it never comes to any of that. Unfortunately whoever is on the contract will have an I9 on their credit which can really hurt them in the future. I hate to see repos happen to good people going through tough times, if they can't afford to redeem the vehicle I would just wait for the vehicle to be sold and then make arrangements to pay off the deficiency. In the meantime they should start looking at getting a cheap $1000-5000 car for the meantime, if they dont have that kind of cash then they will want to look at taking out a small personal loan before the repo is on their credit.

[Clever]

Originally posted by Redlyne_mr2
....The demand is always for the full amount of the payments outstanding. They now have anywhere from 2 weeks - 1 month (longest Ive seen) to redeem the vehicle if they do not redeem it then the vehicle will be sold at auction. ...

Thanks for all that information, so the final demand is for the the remaining balance of the loan or the missed payment? I'm just asking out of curiousity now, Im assuming you're a banker.

[Redlyne_mr2]

Originally posted by Clever




Thanks for all that information, so the final demand is for the the remaining balance of the loan or the missed payment? I'm just asking out of curiousity now, Im assuming you're a banker.

Yeah np, its good for people to know this regardless of his or her situation. The final demand is for the missed payments. the only time a demand for the entire balance of the loan is made is when the vehicle is written off and there is no other security. Hehe banker is such an ulgy word, I work for a major automaker