With the prices of cars these days, most everyone gets a loan to buy a car. The bank, finance company, or individual who lends money to you for the car puts a lien on the car which is stated on the title. The loan documents you sign give many rights to the lender if you fail to pay your payments on time.
When you miss a payment, you are considered to be in default. Once a default has occurred, many remedies are available to the lender. It is very important to take a notice of default seriously. Most loan documents allow the lender to take the car back from you (called a repossession). New Hampshire law allows this to be done without a court case as long as there is no breach of the peace.
Repossession agents hired by the lender will look for your car where you live or work and tow it away with or without your knowledge. After, if you cannot reach some repayment agreement with the lender, which most likely will include the repossession agent’s fees and any storage fees involved, you will be notified that the car will be sold at an auto auction. The amount received at the auction will be applied to the amount you owe on the loan, and you will be asked to pay the difference (called a deficiency balance). It is also very likely that the lender will report your default and repossession to the credit bureaus.
If you believe the lender made a mistake or acted improperly regarding the default, repossession, and sale of your car and the lender refuses to acknowledge your concerns, you may have to resort to civil action against the lender. Or if the lender brings a civil action against you for the deficiency balance, you may be able to assert a defense or counterclaim against the lender at that time.
If you need additional information, please contact Attorney Thompson.
Author: George H. Thompson, Esq.