How vehicle finance companies leverage vehicle contents

On Behalf of | Jul 10, 2024 | Wrongful Repossession

Repossession is a concern for anyone who finances a vehicle purchase. Until they pay off the vehicle loan in full, the lender could reclaim the property as the collateral for the loan. People sometimes wake up in the morning to find their vehicle missing from their driveway because they have missed a few loan payments.

The law heavily favors lenders in automotive loan scenarios. They do not have to provide advance notice of repossession and can pass the cost of repossession back to the person who defaulted on their loan payments.

However, there are rules in place intended to protect people who finance vehicle purchases. Among them are limitations on repossession activity. One of the more common violations of repossession laws involve vehicle loan providers trying to leverage the contents of a vehicle to demand additional funds from borrowers in default.

How companies misuse personal property after repossession

People tend to store a variety of valuable items in their vehicles. For example, a plumber might have the tools of their trade in the back of a van, SUV or truck that they drive to client’s homes. Personal electronics and a host of other valuable items are often inside vehicles when lenders repossess them. The owner of the vehicle should be able to reclaim those items even if they can’t redeem the vehicle immediately.

Companies sometimes attempt to extort vehicle owners by forcing them to pay storage or retrieval fees for the assets in their vehicles at the time of repossession. Even repossession companies hired by major automotive organizations and lenders sometimes attempt to impose inappropriate and illegal fees when vehicle owners seek to reclaim their personal property.

People can fight abusive collection practices

Individuals do not have to accept the financial misconduct of a business during or after the repossession process. Flagrant violations of consumer protection rules might justify taking legal action. Those dealing with an improperly repossessed vehicle or misconduct on the part of a lender repossessing a vehicle may have grounds for a civil lawsuit. Given that many organizations prioritize profit above all else, a lawsuit that eats into company profit margins may inspire a change in business practices.

Recognizing violations of repossession law when they occur can help people assert themselves. Illegal repossession tactics add insult to injury by compounding the stress of those dealing with financial hardship.

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