Houston Car Repossession Lawyer
Are you behind on your car note? Has the lender threatened repossession? If so, it’s critical to understand the repossession process.
The Repossession Process
Repossession occurs when a lender takes back property that was used as collateral or leased in a transaction. If you are behind on a car payment, the lender that financed your vehicle can repossess it at any time.
Texas law does not require any special notice of a repossession. This is a unique area of the law, and one of the more aggressive collection actions in Texas.
When you purchased your vehicle, you probably signed a purchase contract or credit contract to finance the car. In these contracts, the buyer agrees that the seller, also known as the “lienholder,” may repossess the property if the buyer falls behind on payments. Most lenders allow for a small grace period, but don’t count on it. These contracts may also include fines and penalties the buyer must pay to cover the costs of the repossession, as well as the depreciated value of the vehicle.
When you lender chooses to repossess the vehicle, they will usually work with a repossession agent. Most repossession agencies focus on auto repossession. The agent typically uses a tow truck to repossess the vehicle, although some agencies will notify the owner and try to facilitate an amicable return without any surprises.
Many of our clients have lost their vehicles through the repossession process. Some of them were only late by a few days. Small lenders and banks are typically very aggressive and will exercise their repossession rights in a timely fashion.
Bankruptcy Can Save Your Vehicle
Once your car is repossessed, your options are extremely limited. You can try to pay the balance owed at that point (which is probably not an option) or you can file an emergency Chapter 13 bankruptcy. Unfortunately, time is not on your side once they repossess your car.
You only have 10 DAYS after the repossession to file for Chapter 13 bankruptcy and save the vehicle. After this small window expires, the vehicle will be sold at auction. If the lender fails to recoup the amount owed on the vehicle at auction, you may be responsible for the balance owed.