After the car is sold and there is still a balance on the loan, does the bank sue the owner for the difference?
2006-07-06 05:05:58 · 18 answers · asked by Susan S 1 in Business & Finance ➔ Credit
yes
2006-07-06 05:07:35 · answer #1 · answered by The Hit Man 6 · 3⤊ 0⤋
Wow.. so many misinformed people.
Some are correct. YES you WILL be liable for the difference between what you owed and what they sold the car for. PLUS they will add on storage fees, auction fees, towing fees, etc. If you don't pay the deficiency in a timely manner, you likely WILL be sued for the balance. Once they get a judgment against you, they can go after your bank accounts, your wages (if allowed by state law) and any non-exempt assets you may have. Since judgments last a LONG time, they can keep coming after you until the debt gets paid. All the while the judgment is unpaid, it accrues interest.
The vehicle is sold at auction and they typically do NOT get anywhere near what the car is worth, let alone what you owe on it. However, by law, they must sell it in a commercially reasonable manner. IN order to collect a deficiency, they MUST send you ALL of the legally required notices and paperwork. If they fail in that, then they may forfeit their rights to collect a deficiency.
Whether they take it from you, or you VOLUNTARILY give a car back, the process is the same. It's still a repo, you will still owe money, and you can still be sued. It is also still a repo on your credit.
2006-07-06 16:36:32 · answer #2 · answered by SciFiDiva 2 · 0⤊ 0⤋
The bank will give the person a certain amount of time to pay the balance. If they don't meet the deadline, the bank will auction it off. The owner will have to pay the difference. When they auction those vehicles off they don't get any where near the amount owed on it either... The person would do better selling it before it came to that!!!!
2006-07-06 05:08:16 · answer #3 · answered by char__c is a good cooker 7 · 0⤊ 0⤋
the bank has a right to sue the creditor for what is called a deficiency judgment, i.e. the balance of the loan, possibly court costs and attorneys fees depending on the state you live in and the terms of the contract you signed when you borrowed the money
most often this is not done unless the balance is significant
2006-07-06 05:08:53 · answer #4 · answered by whoisgod71 3 · 0⤊ 0⤋
In My experience, the loan has to be paid off, then you pay the impound fee's and such to get the car back. If you can't affors to pay off the loan, you could try and re-finance the loan balance with another company, (be prepared to pay a much higher interest rate), and if you can't do that, then unfortunately, the car will get sold at an auction, or will be returned to the dealer. It's entirely up to them.
2006-07-06 05:12:16 · answer #5 · answered by Travelin Man 1 · 0⤊ 0⤋
Yes the car will be sold if you are not able to recover it and you will be responsible for paying the difference on what they sold it for and what you owed if they were to sell it for more then you owed on it then you are off the hook.
2006-07-06 05:10:25 · answer #6 · answered by jamnjims 5 · 0⤊ 0⤋
Without a doubt....My friend is going to court to fight that very thing....especially because when they sold the vehicle.....they sold it for WAY less than it was even worth, much less owed on it. She is arguing that they didn't meet their obligation by selling it for at least blue book value.
good luck...and get prepared. Don't let them get a judgment w/out you present....judgment is a precursor to garnishing your bank account w/out warning and/or paycheck....at least in Arizona
2006-07-06 05:10:31 · answer #7 · answered by Paula M 5 · 0⤊ 0⤋
yes the bank will sue the owner for the difference and also for any court costs or lawyer fees associated with the sale.
2006-07-06 05:07:34 · answer #8 · answered by Machelle 4 · 0⤊ 0⤋
Yes, they hold you personally accountable for every penny and all court and legal fees. This is one reason why I have never bought a car that I could not pay for in full.
2006-07-06 05:10:58 · answer #9 · answered by Mykl 3 · 0⤊ 0⤋
You will still owe the balance
2006-07-06 05:08:52 · answer #10 · answered by Fire Storm 2 · 0⤊ 0⤋
You still have to pay everything off. The bank essentially sells the car for the payoff, but you still have to pay it off with interest, I believe.
2006-07-06 05:09:05 · answer #11 · answered by Wookie on Water 4 · 0⤊ 0⤋