When you get an auto title loan, repossession is probably the last thing on your mind. So what can you do if your car is repossessed from a title loan? The easiest way to learn more about repossession is to learn about repayment terms and how they work. When you get an auto title loan, most payment plans can range from a few months long to a 36-month repayment period. Paying off your auto title loan early is highly encouraged if there are no prepayment penalties.
It can help you avoid the risk of defaulting on your loan. If you cannot make your monthly payments, you can call your loan officer and tell them that you would like to review your repayment options. If you are currently in repossession, what can you do?
You may have more options than you think! Let Max Cash Title Loans teach you more about the title loan process.
What Happens if Your Car is Repossessed Car is Repossessed from a Title Loan?
So, what happens if your car is repossessed from a title loan? No one is prepared to have their vehicle impounded. A car repossession could happen if you fall behind on monthly payments significantly. It can cost you money and time. Not only could you lose your car, but if the bank resells the vehicle for less than what you owe, you may be responsible for paying the difference.
When there is any property within the car, the lender must return it to the borrower. However, repossession is the last resort for most lenders. The goal is to have the loan paid off before it gets to that point.
How Many Title Loan Payments Can I Miss Before Repossession?
A default payment means the borrower has failed to make the payments required to keep the loan account in good standing and is more likely to go into repossession status. When a loan defaults, it is sent to a collection agency. That agency will call the borrower and try to collect the unpaid debt. It can have consequences like:
- Reducing your credit score,
- Hurting your ability to get future credit,
- And it could lead to the repossession of your vehicle.
Default can depend on the state you live in, but lenders will typically determine when the missed payments are in default and how long the borrower has to contact the lender before they repossess the vehicle in the contract both lender and borrower sign. Borrowers who fail to pay back their auto title loans risk having their car seized by their lender. Each state has specific procedures that lenders follow during the repossession process, but there are a few generalities.
First Thing To Do: Talk To Your Lender if Your Car is Repossessed from a Title Loan
Many things are outside your control during a financial crisis, but you have control over your communication with the lender. They may be able to work with you to come up with a resolution. Most people believe that speaking to a lender will make things worse when the reality is that you should just give them a call.
An analysis of the issue is critical, but if you need time, prompt notice of the problem with a request for time to review is better than silence. Being transparent about what is happening allows for open and candid discussions that will help you build trust with the lender. Give them a call! The loan agent may be able to give you an extension or work out a payment plan that better suits your particular situation.
Grace Period vs. Deferments
There are two types of grace periods, grace periods and deferments. A grace period is a time that creditors give borrowers to make their payments before incurring a late charge or defaulting on the loan. Interest may or may not accrue during grace periods, depending upon the loan’s terms.
Deferments are also periods of time in which borrowers do not have to pay on loans, but deferments most often require an application and proof of financial hardship before the loan holder may grant them. Most deferments are not guaranteed, so borrowers need to be prepared to pay their loans or risk being in default. Both grace periods and deferments are periods of time during which a borrower does not have to pay a lender money toward a loan.
Get Your Vehicle Out Of The Impound
Borrowers today have more options than ever before. If you need help, please do not hesitate to contact Max Cash Title Loans. We are happy to answer any questions you may have about car title loans, missed payment options, or even getting a different car title loan while your vehicle is impounded. We lend out a hand when other companies refuse to help.5 Let Max Cash Title Loans work for you at No Cost!5
You Have Rights!
Even if your car is repossessed, you still have certain protections depending on your contract and the state you reside in.
The lender or repossession agency can repossess the car but not the items inside. If you left anything that is important to you in your car, the lender can’t keep or sell it. In some states, the agency may require you to give them a list of items inside the car and tell you how you can retrieve them. If that is not the case, you may have to call them. Contact your specific lender for more information on how to retrieve your personal belongings.
Can I Refinance My Car Loan If My Vehicle Has Been Repossessed?
It can happen after a late payment, but it’s very difficult if you’re currently behind. Lenders typically require you to be up to date on your vehicle payment and other requirements to approve you to refinance an auto loan. The process of refinancing pays off the existing mortgage and replaces it with a new loan, giving borrowers somewhat of a fresh start. That allows you more time to pay back what you owe. Call us to discuss the potential refinancing options with Max Cash Title Loans!5
What Is a Charge Off?
When a debt has been charged off, it has most likely turned over to a collection agency for collection. Sometimes, the collection agency is paid to collect the debt for the original lender.
Is a Charge Off Better Than a Repossession?
Both of these scenarios are not good, but sometimes, a charge-off is better than a repossession. When a car is repossessed, the lender not only gets to keep the money you’ve already paid, they take your vehicle, and you will still owe the deficiency balance after the vehicle is sold. A charge-off is sent to the collection agency to collect the debt for the original lender.
What Happens If I Pay My Loan Back?
A few required steps put your claim to your name again.
- Confirm your final payment details with your loan agent. Then, let them know you want to start the title retrieval procedure.
- Your car title becomes lien-free through different mediums. This could be done electronically, manually, and by submitting an official form with your vehicle title information.
- Visit the local DMV near your area and get your car title ownership back.
What Is The Plan if My Car is Repossessed from a Title Loan?
A lender can let you get your car back if you pay back what you owe, along with any repossession fees that have been added and, most importantly, if it is before it goes to auction for sale. You can sometimes reinstate the loan and work out a new payment plan.
When going through the process of getting your vehicle back, there are a couple of things that are worth mentioning that borrowers forget. That is, “What is the Plan”?
If you got your car back, would you be able to afford insurance, maintenance, and gas? Getting your vehicle back may be the first thing you want to do. But, do not forget that getting your car back will also require other things. For example, insurance, gas, and maintenance. This is important when getting your car back.
Call Max Cash Title Loans Today!
No matter where you are located in the United States, chances are, we can help you with a short-term loan while you get back on your feet.5 When you need fast cash, do not hesitate to apply for a hassle-free online experience! Call Max Cash Title Loans today for a quote, free of obligation!