Repossession Attorney in Pasadena, California
If you’ve become quite familiar with the world of auto loans, it’s highly likely that you’re familiar with the term repossession. Missing payments in your auto loan could not only result in credit history dents, it can also result in you losing your possessions. Financing an auto purchase results in the car acting as a collateral for the loan, with the lender having rights to take your vehicle away in the chance you violate a policy. This is where repossession comes in.
Repossession is defined as the retrieval of property after a borrower has faulty payments with the action carried out by either the lender or third party services. Two types of loans exist, namely secured and unsecured. Unsecured personal loans enable a borrower to borrow without collateral while secured loans, from the term itself, demand and expect an actual follow up of the borrower paying money.
Of course, not all is gloom and doom. There are ways on how to stop repossession of your items. Repo laws call for you to never miss a beat on your loan agreement in order for lenders to not retrieve your property. There are also certain steps that you can take in order to secure your property.
Repossession laws can be quite complicated to navigate, which is why enlisting the help of a repossession attorney in Pasadena, California is a must should you be faced with this situation. The repossession attorney can help you with every step and can assist you on the best steps to take to stop repossession.
How Does Repossession Work?
The moment you default on payment, repossession can take place. Contracts set the criteria for what lenders define as a loan default and depending on the contract, it can be set off by just one missed payment. Contracts also give lenders the power to take away your property, however, you will be notified of missed payments before taking action on your vehicle.
Should you be non-responsive to the lender’s attempts to contact and settle payments, creditors have the option to repossess the property. Not having a properly insured vehicle also qualifies your property for repossession since basic auto insurance is a requirement in all states. Lapsed insurance policies can set off signals to creditors to repossess your vehicle since your vehicle is a collateral and a car without an insurance may be a risk.
Are you having difficulty understanding these terms? Have you gotten yourself in a repossession situation? If so, it is best to seek legal advice from a seasoned Pasadena repossession attorney who can help straighten matters out and help you counter repossession.
What Items are Subject to Repossession?
Cars aren’t the only items subject to repossession. Many other items can be subject to this treatment to satisfy the secured debt including:
- Real estate
- Rent to own furniture and electronics
- Jewelry
- Tangible assets
Any default in payment can result in repossession. If you are unable to make mortgage payments, lenders will subject your home to foreclosure, selling your real estate for as much as they need in order to recover the outstanding balance.
Is Repossession Indelible on My Credit?
Many people, as much as possible, avoid repossession as repossession is a negative, derogatory mark on one’s credit. Repossession stays on one’s credit file for as long as seven years from the date loan paying halted. Along with bankruptcies and collection accounts, repossession is one of the red flags on credit scores.
Failure to pay auto loans also set off alarms, resulting in negative credit marks. You can be labeled as a delinquent and if sent to a collection agency, the record can also appear on your reports. All these red flags can hinder your ability to borrow in the future, not to mention the existence of a deficiency balance. A deficiency balance is any leftover loan after your collateral has been liquidated.
Dreading the impact repossession might have on your credit and unsure what to do about it? Get expert help from Pasadena repossession attorneys to smoothen the process and explain the situation to you piece by piece so you can smartly make your next move.
How Do I Avoid Repossession in Pasadena, California?
As previously mentioned, if you have a good track record of paying your loans and staying updated on when the next payment is, there is a great chance that you can avoid repossession. However, if you do feel that you are at risk of repossession, here are some tips you can follow in order to stop repossession.
Reinstate the Loan
The first step in this scenario would be to pay all of the missed payments and applicable late fees in one go. This process is also known as reinstating the loan. California law guards borrower’s rights to reinstate the loan post-repossession until the property is sold or disposed of. Violations such as falsification of data, using the car to break the law, or threatening violence against the agent can cause the loan to then only be reinstated every 12 months.
Talk to the Lender
Communicate your issues with your lender if your financial situation doesn’t permit you to pay all missed fees at once. The tasking and pricey nature of repossession is something even lenders do not want to undertake so negotiating with them regarding your missed fees is an option. Talk to your lender regarding giving a grace period or a lower interest rate to make things smoother for both parties.
Sell Your Property
Repossessed properties will likely get disposed of at an auction and if the property sells for less than you owe, you will be liable for the difference. Setting up a private sale can help you get a better price. Selling, however requires the approval of your lender and there is always the risk of them declining this option for no valid reason. This rejection can be used to protect yourself from liability if they receive less at an auction. Otherwise, there is the option to surrender your property which enables you to negotiate it as a full payment of the loan.
Refinance the Loan
Refinancing the loan will have a longer term, meaning you’ll be paying more interest. Ensuring that you can afford a new loan is a requirement for choosing to refinance. The new loan has to have a lower interest rate. Make sure as well that it is worth refinancing since older properties aren’t worth it anymore.
Are you having difficulties navigating the concepts of refinancing? Is negotiating with lenders difficult for you? If so, enlist the help of a Pasadena repossession attorney to help you make smart decisions you (and your credit score) won’t regret. The repossession attorney can also provide you with the assistance you need for avoiding repossession.
Seek Legal Advice from a Repossession Attorney
If you are facing repossession and would like to stop it or are in need of sound legal advice, get in touch with a repossession attorney at the Pasadena Bankruptcy Law firm by contacting them at 626-296-6971. The firm’s attorney also handles chapter 7 and 13 bankruptcy for anyone dealing with financial difficulties. Schedule an appointment with a Pasadena repossession attorney right now and get your life back on track.