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Thread: Car repo'd ! Help

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    Senior Member AzAzn's Avatar
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    Default Car repo'd ! Help

    Has anyone ever had a vehicle repossesed ? If the bank took your vehicle because they said you couldn't afford it, did they really expect you to pay off the car after they took it ? Weren't they just better off keeping you in the vehicle and take payments even though they were late ? Seems weird to pay for something you dont own anymore.
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    Default Re: Car repo'd ! Help

    This sounds like a good question for a lawyer.
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    Default Re: Car repo'd ! Help

    Quote Originally Posted by AzAzn View Post
    Has anyone ever had a vehicle repossesed ? If the bank took your vehicle because they said you couldn't afford it, did they really expect you to pay off the car after they took it ? Weren't they just better off keeping you in the vehicle and take payments even though they were late ? Seems weird to pay for something you dont own anymore.
    Yes, you still have to pay. You can try to negotiate this with them, but your options are kinda limited. Sorry.

    Ariz. Rev. Stat. 47-9615(D)(2) says" The obligor (you) is liable for any deficiency."

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    Senior Member AzAzn's Avatar
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    Default Re: Car repo'd ! Help

    I was 45 days late for a payment and they said i defaulted on the loan. They took the car and I can still make payments. But why the hell would i pay for it if they wont let me have it back. What action can they take against me if i don't. Can they sue me ?
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    Default Re: Car repo'd ! Help

    Sorry to hear that. It sux. Seems a little harsh. It recently happened to a friend, but I think at the 60 day limit... He did negotiate, had to pay towing and storage, but I think just to get payments up to date, not the original payoff like he was first told... You need to decide if the car is worth what you owe, otherwise just demand to get your stuff out of it and walk away... (i.e. can you buy the same car for less than you owe...)

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    Senior Member Blackstone's Avatar
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    Default Re: Car repo'd ! Help

    Quote Originally Posted by AzAzn View Post
    I was 45 days late for a payment and they said i defaulted on the loan. They took the car and I can still make payments. But why the hell would i pay for it if they wont let me have it back. What action can they take against me if i don't. Can they sue me ?
    How many other times have you been late? How many times did you avoid their phone calls?

    Regardless, they can sue you for the amount still owed (minus however much the car sells for at auction), including the cost of repo in most states. Whether they do that or not probably depends on how much you still owe and whether they think they can get
    it out of you.

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    Default Re: Car repo'd ! Help

    (Using made up numbers to illustrate the point)

    The bank gets you a car for $9000.

    You pay $1000 on it in a haphazard way.

    The bank says "This is a problem - they might not even bother paying anymore in the future. We better try to get what we can out of the $8000 bucks we're still owed." (Late payments have a habit of turning into no payments.) They take the collateral you offered up for the loan - the car.

    They auction it off. The market says "Only $3000, buddy."

    So we got

    $9000 out of the banks pocket
    -1000 for payments returned the bank
    -3000 for auction returned to the bank
    ======
    $5000 of their (depositors) money that disappeared.

    You said you were good for the $9000 bucks.

    Is there any question why they want their $5000 bucks back?

    ---

    Let me add, for the bank it's like this.

    Your buddy Laura comes along and says "Hey, can I get a $9000 loan."

    You're like "OK, thats cool, I'll see what I can come up with."

    You go out to Paula and Jessie and they front up some money (aka bank depositors.)

    You give their money to Laura.

    You know Paula and Jessie are coming around looking for their money in the future. They lent it to YOU and don't want to hear no stories about how Laura ain't paying up.

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    Default Re: Car repo'd ! Help

    Yes you still have to pay.

    For a fee (usually a cpl grand) you CAN get the car back though. You have to pay what you owe, plus whatever fees, tow charges, etc....are on there. But you'll have the car back. So at least you arent still paying for something you dont even have.

    Quote Originally Posted by lexilou View Post
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    Default Re: Car repo'd ! Help

    Weren't they just better off keeping you in the vehicle and take payments even though they were late ? Seems weird to pay for something you dont own anymore.
    While I don't want to go into too many financial details in threads outside of the Dollar Den, the lender's reasons for going for a repo actually go beyond direct considerations of lender and borrower. There is also the issue of 'bank reserves' ... meaning that if a bank has $10,000 in additional 'reserves' available it can make new loans totaling up to $100,000 ! And there is an issue of bank credit rating itself which is a function of the percentage of 'delinquent' or 'non-performing' loans versus 'performing' loans.

    Thus from the lenders standpoint, the decision to repo went far beyond avoiding a few thousand dollars worth of loss on your particular vehicl ... which they still may recover by pressuring you to eventually pay off the 'gap' between the outstanding loan balance and the amount of money 'recovered' at auction. From the bank's standpoint, $5,000 in the hand via repo and auction means being able to write up to $50,000 in new loans to other borrowers. From the bank's standpoint, $5,000 in hand via repo and auction means a lower overall percentage of 'delinquent' or 'non-performing' loans once your repo and auction sale is written off as a loss and dropped from the bank's 'portfolio of loans ( which in a collective sense may allow the bank to earn higher profits on all of its new loans due to lower 'wholesale' borrowing costs).

    In other words, because of the way our 'fractional' banking system works, there is actually a lot more involved than just the simple lender versus borrower total dollars.

    As to continuing to make payments on the 'gap' amount or not, ultimately the bank will keep hounding you but on a $5,000 'gap' payment they really don't have a lot of real world recourse besides trashing your credit rating. Yes the bank could go for a judgement, but this would cost them enough in legal fees versus a potential $5,000 recovery that it probably isn't worth it to them.

    However, be aware that there is also a principle known as 'universal default'. Under this principle, if you go into 'default' on one type of credit ( i.e. your car loan ), this can be used by other lenders ( i.e. credit cards ) to enact super-high 'penalty' interest rates. This practice will soon be outlawed by the new Credit Card Bill of Rights, but right now it is still in effect. Thus continuing to pay on your car loan may be worth some additional money to you if it prevents your credit card interest rates from jumping from 12% to 30% !

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    Default Re: Car repo'd ! Help

    Honestly, the bank is likely to go after the deficiency. Their lawyers work on a contingency. That is the lawyer only gets paid if the bank gets paid. So, beyond a little more paperwork, the bank is not out much by sending a lawyer after you. Worse, the bank can simply sell your bad debt to a third party debt collector. Then the collector owns your debt and can pursue you. Again, the collector's lawyers work on a contingency so it costs the collector very little to go after you.

    HTH
    Z

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    Default Re: Car repo'd ! Help

    I actually got caught up with the car, but they kept it in a repo status. With the additional tow and storage fees, I was not able to get the car out. The repo yard didn't even let me get my stuff out of the car. They kept everything in there, CD's, jumper cables, clothes, etc. The car won't sell at auction for a good price because the carfax will show water damage. It doesn't actually have water damage, the engine was replaced because I hydro-locked it. It's still a strong motor, better than the one I had before. I guess I'm screwed. I will try to settle and put this behind me. It just sucks that I can afford it now. Replacing the motor on the car really put my payments behind. Purchasing a new vehicle will be harder now with the repo on my record. Thanks guys.
    ~Even now in Heaven, there are Angels carrying savage weapons~

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    Senior Member Blackstone's Avatar
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    Default Re: Car repo'd ! Help

    Quote Originally Posted by Zofia View Post
    Honestly, the bank is likely to go after the deficiency. Their lawyers work on a contingency. That is the lawyer only gets paid if the bank gets paid. So, beyond a little more paperwork, the bank is not out much by sending a lawyer after you. Worse, the bank can simply sell your bad debt to a third party debt collector. Then the collector owns your debt and can pursue you. Again, the collector's lawyers work on a contingency so it costs the collector very little to go after you.

    HTH
    Z
    I've never heard of a bank lawyer working on contingency for a collection action. That would be a really unusual setup.

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    Default Re: Car repo'd ! Help

    Quote Originally Posted by Blackstone View Post
    I've never heard of a bank lawyer working on contingency for a collection action. That would be a really unusual setup.
    Around here, that's the only way collection lawyers work. They get a percentage of what they collect. We bought a company in bankruptcy a couple of years ago and had a real fight with a couple of debt collectors trying to collect after we rehabbed the business. Had to take them back to bankruptcy court. In their depositions, they admitted they had a bunch of debts on a contingency and hoped they could shake us down. They claimed they didn't even know the company they were trying to collect from had been through bankruptcy. The bankruptcy trustee said that the contingent fee arrangement was routine, but trying to collect from a company that had been discharged in bankruptcy violated the discharge. He also said that they had an obligation to check and see if a debtor had been discharged in bankruptcy. He gave the lawyers the option of reimbursing us our attorney fees or go before the judge for a contempt hearing and having a report made to the state bar. They decided to pay us our attorney fees. (I reported them to the state bar.) Given what the trustee said, I thought all collection attorneys worked on a contingency. Maybe not where you are?

    Z

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    Default Re: Car repo'd ! Help

    Quote Originally Posted by AzAzn View Post
    I actually got caught up with the car, but they kept it in a repo status. With the additional tow and storage fees, I was not able to get the car out. The repo yard didn't even let me get my stuff out of the car. They kept everything in there, CD's, jumper cables, clothes, etc. The car won't sell at auction for a good price because the carfax will show water damage. It doesn't actually have water damage, the engine was replaced because I hydro-locked it. It's still a strong motor, better than the one I had before. I guess I'm screwed. I will try to settle and put this behind me. It just sucks that I can afford it now. Replacing the motor on the car really put my payments behind. Purchasing a new vehicle will be harder now with the repo on my record. Thanks guys.
    It is illegal for them to keep your stuff thats IN the car. They can charge you a fee..like $100..to get it out, but they cant outright NOT let you get it. Its a personal property law...the stuff you had IN the car has nothing to do with the debt OF the car. They cannot legally keep it.

    BTW...I just had my car repo'd yesterday. Again. Because I'm a retard and a loser. Sucks. So yeah..I'm REALLY up on my repo info.

    Quote Originally Posted by lexilou View Post
    "I'll picklepunch you in your twatwaffle!"

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