I think my friend is about to have her car repossessed, what happens when they do?

Answer 1

Much depends on the lender i.e., bank, credit union, finance company, or buy here pay here. With a primary lender the car will be taken back from your friend, either voluntarily or not, (does not matter). The car will be handled by a professional wholesaler who has an arrangement with the lender. It will be detailed to look as good as possible and will be taken to a dealer auction. So let's say that your friend owes a $10,000 balance. Add to that the cost of the wholesaler working on behalf of the bank. Add transportation costs to the sale and auction fees. So now we're at about $10,500. It's extremely rare that the car will bring at or more than the payoff amount. If it were worth more your friend would have sold it to escape repossesion. The car brings $7500 on the auction block. On your friends credit report a repossesion will be shown and the difference between the balance and the sale price will be shown as either an amount past due or a charge off of $3000 in this example. Technically your friend is liable for that amount. But even if she pays it her credit will remain blemished for up to seven years. It's very unlikely that much effort will be exerted by the lender to collect the $3000. And the blemish on her credit won't cause her much problem for long, especially if her other affairs are in better order.

Answer 2

They tow it to impound, where it is charged daily fees, and those fees are added to your debt owed the lender. From there it goes to auction, where used car dealers, and the public in some cases, bid for it. Cars are sold far below their value, or what you owe on the loan. Now, if the car does sell for less than what you owe, you get to continue making payments until the loan is paid off. So, really you lose big time when a repo happens. And don't let someone tell you it's better to do a voluntary repo, where you approach the lender, and say you want to return the car, there is no difference between the two, only that you are expediting the process. As far as your credit rating, it will suffer for seven long years. If you refuse to pay the balance of the loan, garnishments, liens put on other cars you own, or assets you have, all will be attempted to satisfy the loan agreement.

Answer 3

Laws differ from state to state, but generally, if your friend is behind on car payments, the creditor can take possession of the car without notice. Unless the contract gives a grace period, the car can be repossessed even if they are only 1 day late.

You are not required to give the car to the creditor, but they may take it from the street or a parking lot.
Concealment of the vehicle with intent to hinder the creditor may be a criminal offense.
If the car is repossessed, the creditor can sell the car at an auction, and you may still have to pay the balance remaining on the loan after sale of the vehicle, plus the creditor's collection expenses.

Asvise your friend to contact the lender & make arrangements to pay .
OR
Make other arangements for transportation.

Answer 4

We've had the unfortunate pleasure of getting ours repoed. I don't know why your friend got hers repossessed but in our case, it was due to a late payment on the car and if we did not get the car out of that impound in time, they would have sold the car at an auction. Not saying that is going to happen to your friend but she may want to get on top of things to be on the safe side.

Answer 5

banks usually give you 10 to 14 days to bring loan up to date ,then it will probably go to auction. you will then be responsible for the differance between what it sells for at auction and your outstanding balance at time of reposession

Answer 6

They sell the car qiuckly so they can make some money and unfortunely, you get a bike.

Answer 7

they sell the car for what they can get and your friend will have to cover a balance if there is one

Answer 8

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