Car repo - what do we do now?

[angellynne]

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

Car repossessed yesterday due to non-payment; have paid on the loan for five years of the six-year term, but unable to maintain on-time payments due to reduced income. The only remedy, according to the bank is to sell the car and we would be responsible for the deficiency amount between what is owed and what the car sells for. This amount will likely be more than we are able to pay in a lump sum amount. They will not allow us to pay the two payments plus fees that we are behind. What will happen next? Since the car is in our names, do we continue to pay insurance premiums on the car even though we will never drive it again? We have no idea where to go from here. Should we seek legal counsel at this point?

 

[swalsh411]

It will be sold at auction and the selling price (which will almost certainly be under blue book) will be applied to your loan balance (which will now include repo fees, towing, and storage). You will owe whatever is left on the loan and if you don't pay they can sue you.

And no you do not need to keep insurance on a car no longer in your possession.

 

[OHRoadwarrior]

NC has special redemption rights to redeem your car before auction. If you hurry, you can get it back.

http://www.ncdoj.gov/Consumer/Automobiles/Car-Repossession.aspx

 

[angellynne]

Thank you for your reply.

So when they sue for the deficiency will they demand the entire difference in one lump sum? I am pretty certain we will not be able to pay what is sure to be a several thousand dollar difference. Is it best to try to work something out with them prior to them getting a judgement or is that not possible or advisable?

In order to obtain another (used, much less expensive) vehicle so I am able to get to work, should we act now (with co-signer if needed) prior to our credit report showing the repo or will we never be able to purchase another vehicle? (or at least as long as the repo is on our credit report)

Thank you for any advice. It is appreciated.

 

[angellynne]

OHRoadwarrior,

I was told today by the creditor (WFDS) the only way we could get the car back now is to pay the loan off in full. We have absolutely no means to do that, nor do we have family members in a position to loan this much money to us. Are there other remedies under NC law?

 

[OHRoadwarrior]

When the vehicle is repossessed, the finance company has the right to ask for the late payments, plus the cost of repossession, or to ask for the entire balance of the loan to be paid. Perhaps a relative can assist in a refinance.

 

[angellynne]

Thank you --

just one more question, what type of refinance would be an option? a personal loan from a relative or would the creditor consider this option?

 

[swalsh411]

They don't care how you get the money.