Most Minnesota vehicle owners carry auto loans for the vehicles that they’re driving. Auto loans are commonly known as asset-backed loans where the vehicle is used as a form of collateral to ensure the borrower makes timely loan payments. Unfortunately, sometimes the lienholder may make a mistake and illegally repossess your vehicle for a variety of reasons.
Lack of insurance coverage
Wrongful repossession of motor vehicles may simply be a result of a paperwork issues in regard to your insurance. If you recently changed your car insurance company, the lender may not have been notified of the change. To your financial institution, it looks like you let your insurance coverage lapse as your previous car insurance company tells the lienholder that you no longer have a policy.
A data entry error regarding timely payment
In some cases, there may have been a data error made by the lienholder’s staff. You may have sent in your payment, and it was deducted from your checking account. However, the staff member didn’t properly record your payment in the system. The system may alert the lienholder that you didn’t pay your monthly bill, and he or she may unknowingly initiate a repossession order for your vehicle.
Picked up the wrong vehicle
It’s not unheard of for a repossession company to forget to verify specific vehicle information when making a repossession. If another car that is of a similar make, model, and color to your vehicle has a repossession order, the repossession company may mistakenly take your car. Having the company try and verify the VIN and license plate number should help to alleviate the problem.
No one looks forward to having a vehicle repossessed. Unfortunately, vehicle repossessions do happen, and, sometimes, they may happen wrongfully. If your vehicle was illegally repossessed, you should contact an attorney to help you move forward in regaining custody of it.