Car Repossession & Loan Debt Attorney
When you purchase a new car, you can choose to pay for the vehicle in full at the time of purchase or to finance it over time with the help of a lender. Although some people may be able to pay for a vehicle out of pocket, most will need to take out a loan in order to afford the car.
No one who defaults, or fails to make payments, on a car loan plans to miss payments. However, when your circumstances change unexpectedly, it may become difficult or impossible to keep making your car loan payments. If you default on your loan, the lender can repossess the vehicle and sell it in order to recoup their losses. If the car’s sale price isn’t enough to cover the debt, you will owe a deficiency balance.
Whether your car has been repossessed in the last few days, you are facing a possible repossession, or you owe a deficiency balance on a car you already lost, consult the car repossession law experts at Ted Machi & Associates. In many cases, bankruptcy will be the best option to help you recover from your debts and get back your vehicle or avoid the repossession. Our team can help you understand your options and help you decide if filing for bankruptcy is the right action for you to take.
Defaulting on a Car Loan
As soon as you miss your first payment on a car loan, you are considered to be in default. In some cases, you may be able to make arrangements with the lender to reduce payments and avoid repossession. However, if you are not able to make any alternative arrangements, or if you continue to miss payments, the lender will eventually repossess your vehicle.
In most cases, the lender will not be required to give you any notice before repossessing your vehicle. The lender or an agent of the lender can seize the vehicle at any time, even if the vehicle is on your property.
If you are behind on your car payments and you know repossession is a possibility, you have a few options: you can try to negotiate with the lender to stop the repossession, you can try to sell the car yourself to pay the debt, or you can file for bankruptcy to stop the process altogether. If you ultimately decide that filing for bankruptcy is the best option for you, contact Ted Machi & Associates so that we can help you get started on the process.
A deficiency balance is a balance you owe after a lender has repossessed your vehicle and sold it. Deficiency balances occur when the lender isn’t able to sell your vehicle at a high enough price to completely cover your unpaid debt. This may occur because the vehicle isn’t worth as much as you owe on the loan or because the lender accepts a price for the car that is lower than the vehicle’s value. This situation is common since vehicles quickly decline in value as they age.
You may be able to avoid incurring a deficiency balance by selling the vehicle yourself before repossession occurs. However, if the lender has already repossessed your vehicle, you can’t prevent the deficiency balance unless you can get the vehicle back by filing for bankruptcy or working out a payment plan.
If you owe a deficiency, you can pay the balance in full, negotiate a payment plan with the lender, or offer the lender a settlement. If you cannot pay what you owe and you are unable to reach an agreement with the lender, the lender may be able to collect from you using more aggressive methods such as wage garnishment. Before this happens, contact Ted Machi, a Board-Certified bankruptcy attorney.
When you should Declare Bankruptcy
Not every consumer who is facing repossession of a vehicle and/or a deficiency balance will need to file for bankruptcy. However, if your vehicle has been repossessed, you need to prevent the repossession of your vehicle, you owe a substantial deficiency balance, or you owe a deficiency balance in addition to many other debts, bankruptcy is your best option.
If your lender has already seized your vehicle, filing for bankruptcy may help you get it back (as long as it hasn’t already been sold). If your lender hasn’t already seized your vehicle, bankruptcy proceedings will usually stop the lender from repossessing it. Bankruptcy will also help you deal with any debts accrued due to deficiency balances. In many cases, you will be able to discharge a deficiency balance through bankruptcy.
If your vehicle has been repossessed, you are facing a possible vehicle repossession, or you owe a deficiency balance, our experienced attorneys can help. Contact Ted Machi & Associates. today to learn more about your options for discharging debts through bankruptcy.