The finance company said since the car is not worth what I owe, they are going to sue me for the difference. My questions.
1. Do they have to sell it first then come after me for the difference?
2. How long does this all take? They said they were going to start wage garnishment right away, but that doesn't sound right. Don't they have to sue me, serve me, get a default judgement, and then garnish?
2007-12-31 11:27:34 · 6 answers · asked by Fred T 1 in Business & Finance ➔ Personal Finance
I live in CA if that helps
2007-12-31 11:40:30 · update #1
4 months before the shoes falls!!!
2008-01-04 10:38:32 · answer #1 · answered by Anonymous · 0⤊ 0⤋
The normal process is to sell the car at an auction first. The net from the sale will be applied to the outstanding balance on your loan contract. I say net because there will be fees charged.
Then they will get a judgment against you for the difference. The judgment will go to the garnishment process. In most places this is a pretty routine activity. The time depends upon the efficiency of the finance company's law firm and the backlog in your local courts that handle this. Since this is a very common process it is probably a routine process for the local law offices and courts.
My guess would be 30-60 days from their taking possession to the garnishment action is accomplished and the amount is taken out of your paycheck..
Why don't you go to legal aid in your county offices to find out what the typical time is in your area?
2007-12-31 21:09:01 · answer #2 · answered by ? 1 · 0⤊ 0⤋
Until they sell the vehicle, they don't know how much the shortfall is. However, they are NOT required to make an effort to get the most out of the car and the CAN add the cost of repossessing and selling the car to what you owe. They usually dump the car at a wholesale auction for less than 1/3rd of what you could sell it for. If at all possible, you are best off if you can arrange a private sale and arrange to borrow the difference to clear the title.
2007-12-31 20:43:43 · answer #3 · answered by STEVEN F 7 · 0⤊ 1⤋
It won't take them long, they want their money, and they have had to do this many, many times before!
It is a pity you let this happen, they will sell it for next to nothing, and you will owe big-time....If you had acted sooner, you could have sold the car yourself and likely gotten much more to put towards the loan.
2007-12-31 19:46:41 · answer #4 · answered by Anonymous · 0⤊ 1⤋
The laws vary a little from state to state, but generally they have to sell the vehicle first. Otherwise they do not know if there will be any shortfall. Then it will be at least a few weeks to start a garnishment. I used to do this for a bank and I would move as fast as the courts would allow.
2007-12-31 19:34:35 · answer #5 · answered by rainman91302 1 · 0⤊ 1⤋
1. Yep. They will sell it and subtract whatever they get from what you owe (plus fees off course).
2. It will probably take 3 weeks. They will send you a statement of balance due, and since you probably wont be able to make that payment, they will enter a judgement against you. From there a request for garnishment will be sent to your employer and, incase you werer wondering, any future employers until the balance is paid. Keep in mind they accrue interest until the balance is zero.
Sorry to hear you've lost your car..
Maybe 2008 will bring better luck.
2007-12-31 19:34:10 · answer #6 · answered by edco 5 · 0⤊ 1⤋