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Old 08-29-2009, 05:35 PM
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Collecting on a defauled loan with collateral

What is the name of your state (only U.S. law)? California

I loaned an individual 5,ooo. They put their truck up as collateral incase of default. It is now in default by ten weeks. When can I file court papers to collect the collateral, what papers would I need to file?
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Old 08-29-2009, 06:34 PM
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Quote:
Originally Posted by lisajmilam View Post
What is the name of your state (only U.S. law)? California

I loaned an individual 5,ooo. They put their truck up as collateral incase of default. It is now in default by ten weeks. When can I file court papers to collect the collateral, what papers would I need to file?
Are you the legal owner on the title?
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Old 08-29-2009, 06:44 PM
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AND - have you properly perfected your lien?
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Old 08-29-2009, 08:33 PM
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Collecting on a defaulted loan with collateral

No, I am not the legal owner on the title. I drew up a loan doc which included
payment amounts and due dates, It also stated that incase of default of loan payments he would forfeit his truck. We both signed it and had it notarized.

That is it.
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Old 08-29-2009, 08:45 PM
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Originally Posted by lisajmilam View Post
No, I am not the legal owner on the title. I drew up a loan doc which included
payment amounts and due dates, It also stated that incase of default of loan payments he would forfeit his truck. We both signed it and had it notarized.

That is it.
Then you have no collateral. That is it. Take your friend to court, but you cannot take the car.
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Old 08-29-2009, 11:07 PM
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The balance defaulted on is 2,700. Too big for small claims, how can I file and why isn't the agreement binding?
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Old 08-29-2009, 11:57 PM
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Originally Posted by lisajmilam View Post
The balance defaulted on is 2,700. Too big for small claims, how can I file and why isn't the agreement binding?
It is not too big for small claims.

I never said your agreement wasn't binding. I said you had no collateral. For you to have the collateral, he should have given you the title and you should have added yourself as legal owner and then filed it with the DMV. You did not, so you don't have collateral.

You can certainly take him to small claims court, you just can't take his vehicle.
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