Typically, the process begins when the lender sends the borrower a notice of default, informing them that they are behind on their car payments and that the lender is considering repossessing the car. The borrower may have a certain amount of time to bring their account current, usually 10 to 30 days. If they fail to do so, the lender may proceed with the repossession.
The lender may then hire a repossession agency to take possession of the car. The agency will typically track down the car and impound it, either at a private lot or at a police impound lot. The borrower may have a right to redeem the car by paying the outstanding balance plus any repossession fees, but they must usually do so within a certain amount of time, typically 10 to 30 days.
If the borrower fails to redeem the car within the allotted time, the lender may sell the car at a public auction. The proceeds from the sale will go towards satisfying the outstanding balance on the loan, as well as any other costs associated with the repossession and sale. If there is a surplus, it will be returned to the borrower.
It is important to note that the specific laws and procedures governing the repossession process can vary from one jurisdiction to another, and the process may also differ depending on the terms of the loan agreement between the borrower and the lender. If you are facing the possibility of repossession, it is important to speak with an experienced attorney to understand your rights and options and to protect your interests.
