Car repossession can be a scary and traumatic event for any vehicle owner. You’ve spent a lot of money on a car, truck, van, or SUV to provide for your family’s transportation, make getting to work easier, and in some cases, serve as your place of business. When that vehicle is taken away, it can leave you struggling. But even when your car is repoed, you have rights that can help protect your property.

What is Car Repossession?

repossession occurs when an owner’s vehicle is taken, or repossessed, by a person or company that holds a security interest in it. In most cases, this security interest is held by the entity that loaned the owner the money to purchase the vehicle in the form of a lien on the title and serves as a guarantee that the loan will be paid in accordance with its terms.

When this entity exercises their security interest by repossessing the vehicle, it’s removed from your possession either temporarily or until they gain that possession permanently. If your car gets repossessed, you need to contact an experienced lawyer immediately to find out what your rights are when your car is repossessed and protect them.

The Texas Repossession Process

In Texas, repo companies are not licensed and may breach the peace during the repossession process. This means that some repo companies may make verbal threats or even damage your property. They are also not required to provide notice. This is why most repossessions in Texas happen at night or when you’re at work. They hope you are either asleep or will not want to make a scene on the job.

A lienholder will contact a repo company and provide them information about the vehicle, including the owner’s name, address, phone number, work address, vehicle description, tags, and VIN. The company will determine when and where to take the vehicle. A tow truck pulls up, connects to your vehicle, and drives off, often without the owner being aware until they return to where their vehicle was parked and find it missing.

What To Do If Your Car Is Being Repossessed

Don’t get into a confrontation with the repo company or damage the vehicle. You do have rights if your car is repossessed, but they only extend so far. While repossession agents are not supposed to breach the peace, neither are you. If a confrontation becomes physical, your problems could grow beyond simple repossession. You can tell them not to take your car and refuse to give them the keys, but beyond that, your best option is to contact an attorney immediately.

Once a vehicle is repossessed,  you have 10 days before the lien holder can sell it at auction. After this, you will no longer own the vehicle, but you’re still responsible for any amount not recovered from the auction of the vehicle. This means that collection efforts could continue.

What About My Personal Property Inside the Car?

It’s important to note that even if they have a legal right to repossess your vehicle, neither the lien holder nor the repo company has a right to the personal property stored in it. It must be returned to you. After you contact your attorney, you will want to contact the repo company or lienholder for information about retrieving your property.

If it’s not returned, you can file a suit in small claims court for the fair market value, but attempting communication first is always the best choice. Just remain professional and calm while requesting your property. Many car lenders or towing services try to trick people by telling them they have to sign a document to get their personal property back, and that documents gives up all ownership rights to the vehicle. Please be careful what you are signing.

What To Do After Your Car Is Repossessed

Get legal help as soon as possible. When your car is repossessed, the best way to get the vehicle back is by filing a Chapter 13 bankruptcy. Normally, you may only have a 10-day window to work with. You will need to act fast and decide quickly on the right path forward for you. Even once the car gets repoed, you still may be able to get your vehicle returned to you.

  • Paid In Full – When a vehicle is repossessed because the terms of the lease were breached, a creditor may accelerate the loan, meaning they demand that the remaining cost of the vehicle, interest, fees, and cost of repossession be paid in order to get the vehicle back. This is usually not an option possible for the vehicle owner.
  • Reinstatement – If you’re able to catch up on the payments, fees, and repo costs, the lender may let you resume the loan as if the repossession never happened. This, too, may not be an option for you.
  • Refinancing – Your creditor may also be open to refinancing the debt if you previously had a good payment history. In refinancing, a new loan agreement is drawn up to account for the existing debt, but offer payment terms that are easier for you to make.
  • Chapter 13 Bankruptcy Relief – Filing for bankruptcy under Chapter 13 can pause repossession efforts and help you eliminate or restructure your unsecured debts, such as credit cards. Filing a Chapter 13 bankruptcy will force the car lender to give back your vehicle that has been repossessed. This can leave you the money you need to make your car payments on time as well as handle your other living expenses with more money left over at the end of the month.

Talk to an Attorney Experienced in Texas Repo Laws

Repossession can be shocking, but if you act fast you can protect your property rights during the repossession and may be able to regain the vehicle you worked so hard for. Our Dallas bankruptcy lawyers are ready to help you find a way back to financial stability. Contact the Leinart Law Firm today for a free consultation about your case, and what you can do to avoid or recover from repossession.