Borrowing money from a bank or creditor is always facilitated as this society seems to want more and more debtors. However, when it comes to default loans, nobody seems to try to facilitate your monthly payment towards the creditor. And in case the loan was made in order to buy a car with the lent money, most creditors are the real owners of that vehicle until the loan account has been cleared. So, they have the right to resort to car repossession if they want to recuperate their money from the debtor and apparently there is no other solution. They have that stipulated somewhere in the contract, so knowing what you sign when making a loan contract should be top priority. In case car repossession is acceptable according to the contract initially signed by both parties, then the creditors also have the right to do with the car whatever they want, either keep it or sell it to get their money back.
However, before car repossession takes place, there are some procedures that should be followed by the creditor. The first is to let the debtor know that he is late with the monthly payment and give a warning notice either via email or by phone. Next should come a grace period during which more warnings come from the creditor to the debtor. In case the grace period is over, the creditor – if so stipulated by the contract or by the law, has the right to resort to car repossession to collect his money back, either doing this by himself or by hiring a car repossession company.
Now, car repossession can be either voluntary or non voluntary. The former is more advantageous than the latter, as in this case the creditor will not charge the debtor at all for the repossession or the storing of the vehicle as the debtor will actually take the car himself to the lender. In case of non voluntary car repossession, the situation can really worsen financially for the debtor as the charges and the fees will only add to the debt he has to the bank.
It is always very important for the creditor to employ a car repossession company that work effectively and professionally, in one word, expeditiously. The creditor needs the money and he may want to sue the debtor so that he can get the deficiency payment, the difference between what the debtor owes in reality and the amount of money he would get from selling the car. Of course repossession would work best in the interest of the creditor rather than that of the debtor. But if car repossession has produced some damage, then we deal with what is called a breach of peace on the part of the creditor, and then the creditor might not benefit from the repossession as he would like to. That is why, it is always a smart thing to read contracts and laws and to know one’s own rights.