How Much Time Do I Have Before A Title Loan Company Can Repossess My Vehicle?
Worried that your car is going to be repossessed by a title loan company? Getting behind on your bills is uncomfortable but getting behind when your car is on the line can be downright frightening. Knowing what to expect and what actions you can take to avoid repossession are a few of the only things that can offer you some comfort. If you fall behind on a title loan you do have a few options, but time is always of the essence because once your car is repossessed you have significantly fewer options.
Avoid Repossession After Taking Out A Title Loan
While some online title loan lenders want you to believe that they can push you around, a repossession hurts them almost as much as it hurts you. Therefore, if you can work with them many lenders will respond positively because they would rather you get back on track than force their hand and a repossession. The best thing you can do is stay in contact with your lender and let them know if you are facing sudden financial difficulty.
It is uncomfortable to call a lender and tell them that you lost your job or are temporarily experiencing some type of hardship, which is why most people dig their heads in the sand instead. However, maintaining contact and letting a lender know that while you may default this month you are capable of getting back on track shortly cold mean the difference between one missed payment and a repossession. If the situation is likely to last longer than a month, then it might be time to look into bankruptcy protection.
How Much Time Do I Actually Have Before the Vehicle Gets Repossessed
Each online title loan lender has its own policy when it comes to repossession. If you still have your original loan papers the repossession guidelines are likely in the fine print and worth checking out if you are concerned. If you are behind on your payments and have made no effort to reach out to your lender, then it is possible that they could repossess your car in just 30 days, depending on the state you live in. This is another reason that constant communication even in times of difficulty is so important.
On the other hand, you should be aware that if you hold a brand new title loan and miss the first or second payments, they are allowed to act much quicker in some states based on bad faith laws. For example, if you take out a loan and then find that your phone numbers are now disconnected and you don’t respond to their attempts to communicate with you. In this type of situation, the title loan company can slate your car for repossession after 15 days.
What Happens After A Vehicle Is Repossessed By A Title Lender
Directly following a repossession most people are shocked, and then want to know what happens to their vehicle. Will it be immediately sold or is it just sitting in a lot somewhere unused? While this often depends on the state law which can force lenders to follow a strict process before selling a vehicle, there is a general process that most lenders will follow.
Part of the shock of repossession is the actual repossession. Chances are no one will knock on your door or tell you that the time has officially come. Repossessions are not enjoyable for either party and usually happen quickly and stealthily. One day you may walk your door to go to work and your car is simply not there, or it may even be repossessed from the workplace parking lot leaving you stranded.
Following the repossession, the lender may give you the chance to make your payments and get up-to-date to get your vehicle back. Do your part and talk with the lender, see if there’s any way they will work with you to lower the amount owed and negotiate a new payoff contract. Once again, state law plays a role here, but it is usually in the best interest of the lender to accept your payments if you can settle your account versus finding a new buyer at an auction. Use a title loan calculator to come up with different approaches and settlement amounts to see how the loan can be paid off quicker. After the cooling-off period ends, the lender will most likely auction your vehicle in an attempt to recoup some of their losses.
Jessica has blogged about the title loan industry since 2012. Before that she managed a team of customer service representatives for one of the largest payday loan companies in the US. Since coming to Premier Title Loans she’s overseen our sales and marketing department and looks forward to educating consumers on their different financing options. Jessica is always open to feedback and questions that relate to short term loans!