Started By
Message
Rant Lawyers: Is it normal practice for lenders to sue AFTER repossesion?
Posted on 10/6/15 at 4:30 am
Posted on 10/6/15 at 4:30 am
Back story: My little brother bought a nice truck a couple years ago while he was still living at home. He bought it from a dealership and financed about 80% of it through a credit union. For the first year he paid on time plus some most months. He fell behind on payments after a series of unfortunate events, and moved in with a relative out of state. Because he had moved and was in a different state he did not receive the notice of repossession until a week before the actual repo. He had changed phone numbers so there was also no phone notification. The notice was sent when he was 3 months behind but he got it and it was repoed in the 4th month. He was on the verge of resuming payments until the notice came when family advised him to do a voluntary repossession, but it was too late and the truck was towed off the day he planned to call and set it up.
That was 1 year ago. Nothing was heard again about the truck or from the bank until today when somebody showed up at our dad's house looking for my brother to serve him papers. Our lawyer was able to find out that it's the credit union suing him for money owed plus attorney fees for a total of ~$8000. She advised my brother to be on alert and try to avoid being served for as long as possible to prolong everything.
It'll be a couple days before our lawyer can sit down and discuss things so I'm trying to help him as much as I can in the meantime. I've never heard of this happening and the only loan I've ever had is student loans, so that's why I come to you, internet. Some of my thoughts:
-He's still living out of state. Same address the truck was repossessed at, so it seems odd they'd send somebody to our dad's house. Not sure what court the lawsuit is being filed, but if it's local are they not allowed to serve him out of state?
-He never received any information on what happened to the truck after it was repossessed. We don't know if the truck was sold, put on the market at all, put up for auction, anything. How much does this matter?
-Is it too late for bankruptcy? If he were able to file before he was served and be declared before the lawsuit goes to court would that make a difference?
Any advice is welcome
That was 1 year ago. Nothing was heard again about the truck or from the bank until today when somebody showed up at our dad's house looking for my brother to serve him papers. Our lawyer was able to find out that it's the credit union suing him for money owed plus attorney fees for a total of ~$8000. She advised my brother to be on alert and try to avoid being served for as long as possible to prolong everything.
It'll be a couple days before our lawyer can sit down and discuss things so I'm trying to help him as much as I can in the meantime. I've never heard of this happening and the only loan I've ever had is student loans, so that's why I come to you, internet. Some of my thoughts:
-He's still living out of state. Same address the truck was repossessed at, so it seems odd they'd send somebody to our dad's house. Not sure what court the lawsuit is being filed, but if it's local are they not allowed to serve him out of state?
-He never received any information on what happened to the truck after it was repossessed. We don't know if the truck was sold, put on the market at all, put up for auction, anything. How much does this matter?
-Is it too late for bankruptcy? If he were able to file before he was served and be declared before the lawsuit goes to court would that make a difference?
Any advice is welcome
8
Posted on 10/6/15 at 5:29 am to bhamtigerman
Tell him to get a higher paying job.
I was trying to be a jerk. I have nothing to add but good luck.
I was trying to be a jerk. I have nothing to add but good luck.
Posted on 10/6/15 at 6:07 am to bhamtigerman
If the finance company sells it (usually at auction) for less than what they loaned someone to purchase the car then they can seek to recoup the difference.
Posted on 10/6/15 at 7:37 am to bhamtigerman
This post was edited on 11/8/20 at 11:07 am
Posted on 10/6/15 at 8:23 am to bhamtigerman
Please tell me how they got his out of state address to come find the truck?
Posted on 10/6/15 at 9:02 am to Chazzy McRamzee
Replying to the last 3 posts all here:
Ted- What they're asking is probably what he owed, so they must not have sold it. Do they need to provide proof that actually tried to sell it? He's received nothing until now.
KrautDawg- At the time he was working for a surveyor but had his hours cut when the owner took on his son part time. Due to their erratic schedule it was difficult for him to take a second job then. He had multiple unexpected large expenses and things got out of hand quick. Not trying to make excuses though, he should have had a good safety net saved up from when he was living at home. 20 year olds aren't very frugal though. But yeah, a second job now definitely would help.
I imagine they found him when he got a job up there and was back "on the grid". Our last name isn't very common. Either that, or the relative he moved in with is our sibling so maybe they checked there when they couldn't find him back home and lucked out
Ted- What they're asking is probably what he owed, so they must not have sold it. Do they need to provide proof that actually tried to sell it? He's received nothing until now.
KrautDawg- At the time he was working for a surveyor but had his hours cut when the owner took on his son part time. Due to their erratic schedule it was difficult for him to take a second job then. He had multiple unexpected large expenses and things got out of hand quick. Not trying to make excuses though, he should have had a good safety net saved up from when he was living at home. 20 year olds aren't very frugal though. But yeah, a second job now definitely would help.
quote:
Please tell me how they got his out of state address to come find the truck?
I imagine they found him when he got a job up there and was back "on the grid". Our last name isn't very common. Either that, or the relative he moved in with is our sibling so maybe they checked there when they couldn't find him back home and lucked out
Posted on 10/6/15 at 9:07 am to Chazzy McRamzee
quote:
Please tell me how they got his out of state address to come find the truck?
The are companies that specialize in tracking people down for debt collectors.
Posted on 10/6/15 at 10:08 am to bhamtigerman
He should contact the credit union and offer freely to pay back the 8k in installments, under the condition that they do no harm to his credit and remove any dings to it that may have already been placed.
Posted on 10/6/15 at 10:29 am to Chazzy McRamzee
quote:
Please tell me how they got his out of state address to come find the truck?
Unless someone really puts effort into living off the grid, crossing a state line isn't much of a barrier at all.
Posted on 10/6/15 at 1:17 pm to Kraut Dawg
My limited experience with creditors and the IRS is that if you have a problem better to be proactive and talk to them. Better for your credit, and to manage the problem. Lenders do NOT want to repossess vehicles or property. They'd much prefer to work out a deal.
if you run from them, this is the shite that happens. One of our daughters was once involved with a guy who lost his house becau
if you run from them, this is the shite that happens. One of our daughters was once involved with a guy who lost his house becau
Posted on 10/6/15 at 2:01 pm to bhamtigerman
Finding him out of town was easy. Repo companies are brutally efficient. As far as contacting your family, your brother likely had to provide a nearest relative to the credit union to get the car loan, or they linked him to your dad through another account.
Your bro is entitled to the paperwork and an itemization of fees surrounding the repo. He can be sued for a deficiency judgment based on the difference between what he owed and what the truck was sold for, interest charges, and the cost of reposessing the truck. This judgment will stick with him (doesn't fall off after seven years) and can affect his ability to get a job, a house, or another car.
Agree that $8k isn't enough to file BK.
Your bro is entitled to the paperwork and an itemization of fees surrounding the repo. He can be sued for a deficiency judgment based on the difference between what he owed and what the truck was sold for, interest charges, and the cost of reposessing the truck. This judgment will stick with him (doesn't fall off after seven years) and can affect his ability to get a job, a house, or another car.
Agree that $8k isn't enough to file BK.
Posted on 10/6/15 at 2:28 pm to bhamtigerman
quote:
Replying to the last 3 posts all here:
Ted- What they're asking is probably what he owed, so they must not have sold it. Do they need to provide proof that actually tried to sell it? He's received nothing until now.
I think he needs to talk to them to get an official accounting of what he owes and why. If they sold the vehicle at a wholesale auction then it may have brought pennies on the dollar (which is why I wouldn't suggest voluntary repo but too late for that now). Once you get an official accounting then you can figure out what to do, but you need more info before you can figure out a plan. And yes, to answer your topic question, it is normal practice for lenders to sue after repossession, as there is almost always a balance after they take back a vehicle and sell it at a wholesale price.
Posted on 10/6/15 at 5:28 pm to bhamtigerman
quote:
I imagine they found him when he got a job up there
So he decided not to pay on his car?
Posted on 10/6/15 at 9:54 pm to bhamtigerman
Your family is poor
Posted on 10/7/15 at 7:05 am to SonofDye
Honestly, making fun of someone for being in a tough situation makes you the poor one.
Posted on 10/7/15 at 8:19 am to Ted2010
quote:
If the finance company sells it (usually at auction) for less than what they loaned someone to purchase the car then they can seek to recoup the difference.
Posted on 10/7/15 at 4:30 pm to Old Sarge
quote:
dings
Dude, they didn't "ding" it, by now they hit it with the Liberty Bell itself!
LOL
This post was edited on 10/7/15 at 4:32 pm
Posted on 10/8/15 at 11:58 am to bhamtigerman
Yes, as others have stated. You can and should in most cases haggle with them. Someone probably bought the loan for .10 on the dollar and now they are trying to get more money from him, that's how they make their money.
Page 1 of 1
Popular
Back to top
Follow SECRant for SEC Football News