Everything You Need to Know About Car Repossession

Are you falling behind on your car payments? One of the many consequences of being unable to pay on time is vehicle repossession. While it is usually the last resort for most lenders, it’s sadly inevitable at some point.

Car repossession does not only cause deprivation of transportation but also potential damage to your credit score. Fortunately, there are ways to avoid getting there. Hence, this article will discuss how to stop car repossession, Delray Beach car repossession specifics, and more.

Car Repossession in Delray Beach

People living in Delray Beach know how important it is to have a vehicle at their disposal at all times. Whether it’s to get to work or drop your children off at school, relying on public transport isn’t feasible in the long run.

However, getting a car out of necessity also means a possible lack of funds to pay for it and the need for auto financing to come in. Again, financing a car requires you to make on-time payments each month with interest. If you haven’t been able to do so, it may be time to look into possible ways out of vehicle repossession.

If you’re wondering how to stop car repossession in Delray Beach has more options for you than you may realize. One of the most common paths people opt for is “Chapter 13 bankruptcy,” as it allows the automatic stay to come into play. An automatic stay ensures that any actions against you are prevented as the bankruptcy procedure progresses.

In terms of repossession, it means that when you’re dealing with the bankruptcy process, your lender, or the “repossession man,” as we call him, is put on hold. Again, an automatic stay is not a permanent resolution, and one must finish the bankruptcy case completely for a definite answer.

During Chapter 13 bankruptcy, all your car loans and debts can be restructured so that they become easier for you to deal with. With more affordable payment plans, you may find it easier to make all the payments and keep your car.

Is Bankruptcy the Only Way Out?

Luckily, bankruptcy is only one of the many possible courses you can take to avoid repossession of your vehicle. Here are some more possible solutions you can consider.

Speak to Your Lender

Keeping your lender in the loop about the reasons behind missing car payments can help in many ways. After all, repossession is costly and only gets more troubling for both the borrower and the lender. Hence, keeping your loan in good standing should be the first priority. Your lender may modify your payment plan or pause payments via forbearance, etc.

Consider an Auto Refinance

If the reason for falling behind on payments has to do with the high-interest rate and unfavorable terms, on the whole, you should consider refinancing your car with a different lender. Through refinancing, you have better chances of landing a lower interest rate and better payment terms. However, refinancing is only a band-aid, and if you still keep on missing payments, a repossession will become inevitable.

Sell the Vehicle Yourself

As one of the last resorts, you may consider selling the vehicle yourself. This way, you may end up getting more money than what your lender may get after auctioning it off. You may even get enough money to pay the loan off entirely, but that usually depends on the amount you owe and the car’s worth. In some cases, selling it may also provide you with enough funds to put a down payment on another vehicle or resolve additional financial concerns.

Surrender It

If you think you’ve explored enough and haven’t found a way out, it may be time to surrender your vehicle voluntarily. Even though surrendering also has the potential to hurt your credit score, it isn’t as bad as repossession. 

Moreover, this way, you’re also able to keep your integrity intact and take the car to the lender yourself instead of having them come to you. Additionally, if the case is such that you owe more than your car’s worth, you may even have some room for bargaining or having some amount waived off or reduced once the lender sells the vehicle.

The Bottom Line

In the end, car repossession can take a toll on your life. It not only hinders your ability to travel within the city but also hurts your credit score, making it difficult to own a vehicle later. Therefore, our attorneys at The Law Offices of John.E.Mufson are equipped to help you retain your vehicle through the right means. 

To learn more about stopping car repossession in Delray Beach, please call our attorneys at (561) 272-1003.