Last Updated on January 1, 2023 by Bernard Juchli
You seem really determined to learn how to stop repo man from taking your car. Is it even possible? Perhaps, it is from a legal standpoint, so let us find out.
You can stop the repo man from taking your car by communicating with your lender for possible options such as forbearance. You can reinstate the loan, initiate voluntarily repossession, refinance your auto loan, or sell the financed car.
Typically, when you are behind on your car payments, the lender considers repossessing the car. Unfortunately, allowing the repo man to have their way can affect your credit score negatively. You do not also get a replacement vehicle, and you may still owe the lender.
How car repossession works
You do not legally own a car you finance because your lender holds the title, which is in their name. A title, of course, shows the registered owner of any vehicle. The lender only releases the car ownership to you after you completely repay the auto loan.
The lender expects you to make your monthly payment until you clear the debt. Failure to continue your monthly payment forces the lender to repossess the vehicle through a repo company. The lender will also sell the car to recoup the amount you owe. If the lender cannot recoup the complete amount after selling the car, you are still liable for payment depending on the agreement.
Note that the timeline a lender considers your auto loan to be in default varies by lenders, there is no fixed timeline. Some lenders can allow a few months while others will immediately attempt to repossess the car after the first month (30 days). Refer to your auto loan contract for this information.
You also want to be familiar with your state laws regarding vehicle repossession. For example, California law permits the lender to repossess a car after one late or missed payment, as well as one missed insurance payment. Moreover, the repo company may not be mandated to notify you about repossessing the car deepening on your state.
How to stop repo man from taking your car
Considering that a repo can damage your credit, you want to stop repo man from taking your car in the following ways:
Discuss options with your lender
Instead of you shying away, discuss with your lender, they might include options that make your loan payment flexible. Inform your lender immediately you think you will miss your next car payment and not after missing it.
Your lender may be able to include a modified payment system, including forbearance which allows you to temporarily lower your payment or pause the loan payment. Follow these steps to lower your car payment without refinancing.
As explained above, forbearance from your lender allows you to temporarily reduce your loan payment or pause it. Your loan contract may contain this option which makes the payment more flexible.
Forbearance is temporary, so make sure to fix your financial difficulties before your payment resumption. Follow this guide to make some money with the car through Uber.
Refinance your auto loan
Consider refinancing your auto loan with another lender with a lower interest rate. This option will not only stop repo man from taking your car but keep your loan payment going, so it does not affect your credit.
When you refinance your auto loan, you are basically taking a new loan to repay your existing loan which allows you to begin with a clean slate.
However, if you are not certain about continuing your loan repayment with the new lender, do not refinance.
Reinstate your auto Loan
Loan reinstatement is the process of restoring a loan after a loan default by paying the total amount past due. You may have to pay an overdue fee and any expenses the lender incurs as a result of the default. This will keep the lender from contacting the repo company to repossess the car from you.
If your state law does not permit loan reinstatement, the lender may allow you to restore to prevent any further costs.
Lock the car in a garage
The repossession company can tow your car if you park it outside, even if it is on your property. Many state laws allow the repo man to access your property to tow a car. However, leaving a financed car locked in the garage can stop the repo man from taking it.
A repo man cannot pick, break, or cut a lock to recover a financed car. They would be breaching the peace if they do so, and it is illegal in most states.
Get rid of the lender’s GPS tracker
If the lender has a GPS on your car, you can take it off to stop them from getting it repossessed. However, if your loan contract allows the lender to attach the GPS, you cannot remove it. Not only will you be penalized, but you may also lose the car.
A built-in GPS that is not mentioned in your loan contract can be removed to prevent the repo man from knowing where to find the car. Note that there are cases when removing the GPS voids the dealer warranty.
Sell the financed car
You do not have the car title, so you cannot sell the car without informing the lender. If the lender okays the deal, the new owner becomes liable for the monthly loan payment.
It may be difficult to find a buyer willing to pay the amount you agreed in the loan, so you could be selling at a loss.
Surrender the car voluntarily
If the methods above do not stop the repo man from taking your car, surrender the financed car voluntarily. Voluntary repossession lets the lender know that you can no longer make the car payment, you also make arrangements with the lender to give up the car.
Although voluntary repossession affects your credit, it is not as damaging as repossession. If you owe more than the value of the financed car, voluntary surrender or repossession may offer you a bargaining advantage such as reducing the owed amount after your lender sells the car. Follow these steps to return your financed car with zero penalties.
Find out your state repossession law
Your decisions should be guided by state law. In some states, the repo company can recover the car without any notice as long as there is no use of force or threat or breaking into a property. Other states mandate the repo company to notify you before they car repossess the car.
Your state law may also mandate the lender to reveal the place of the auction of the repossessed car. You may be able to reinstate the auto loan by getting caught up on past-due payments and paying the default fee and other losses you caused the lender.
Ensure to know your right to prevent any repo company from violating them. If the repossession man violates your right, the company can be fined to compensate you for damages.
What happens if you hide your car from repossession?
Hiding a financed car from the repo man is a bandage. When the lender cannot recover the car after several attempts, they can report it stolen. Hiding it in a garage will stop them from towing it because a repo company cannot legally break locks to access your garage.
When the repo informs the police about the car being stolen, you will turn it in, and the lender recovers it. The lender will sell the car to recoup their loss, but you will be liable for the deficiency balance. A deficiency balance is a difference between the amount that you owe and the amount the lender gets after selling the car at auction.
When you cannot pay the debt, the lender sends it to a collection agency, which is damaging to your credit.
How long will a repo man look for a car?
A repo man can look for a car for up to 30 days. Their aim is to locate the car, tow it to a lot and hold it.
How do repo companies track your car?
A repo company can track your car using GPS tracking devices on cars, license plate scanners, and other possible measures such as your social media posts. A repo man can go through any public parking lots to scan license plates for the car they have to repossess.
Repossession shows that you did not pay off your debt, thus being in default of the auto loan, which is negative for your credit history. Unfortunately, this can remain on your credit report for up to 7 years from the delinquency date.