Repo companies often try to extort money from debtors. Don’t let them.
People come to me often looking for help dealing with debt left over after a car has been repossessed by a dealer, bank, or auto finance company. When I ask about the repossession itself, I very frequently hear something like this:
“They wouldn’t even let me get my stuff out of the car. Can they do that?”
No. They cannot.
If you bought a car on credit, then you took ownership of the vehicle subject to a security interest held by the dealer. A security interest basically means that you’re part-owner of the collateral. Your contract with them gives them certain rights regarding the collateral (the vehicle). The most important right they have is the right to repossess the vehicle when you default on the contract. And as you probably can guess, if you do indeed default on the contract, then they can indeed repossess the vehicle.
But there’s an important thing to remember: they have a security interest in the vehicle, not the items inside the vehicle.
This means that if your car is repossessed, and the repo man, dealer, or finance company has no right to take the property inside the vehicle. For example, if you left your purse in the car and the vehicle is repossessed, they have to give your purse back. They can either mail it to you or give you the opportunity to come and get it. If you call them and ask for your property, they have to make it available to you. It’s that simple. Also:
- They cannot require you to pay a fee in order to come get your property.
- They cannot require you to sign a waiver in order to get your property.
- They cannot take anything out of the vehicle – including any loan, sale, or warranty documents that you left in the vehicle after the sale. Your copies of the transaction documents are your copies. They cannot steal them.
- They can require you to schedule in advance a time to come retrieve your belongings, as long as their requirement is reasonable.
- They don’t have to hold onto your stuff forever. If you want your property back, call them as soon as you know they have it and demand it back immediately. If they refuse, write them a letter and send it certified mail.
- They can require you to sign a receipt that identifies the property that was returned. This is different from a release or a waiver of notices.
- They can charge you a storage fee for holding the goods if you don’t get them as soon as possible after the repossession.
Very often, subprime car dealers will utterly ignore the law. Dealers who are accustomed to customers who are ignorant of their rights and cannot afford an attorney know the law perfectly well, but also know from experience that they can usually steal their customers’ belongings without getting caught. Don’t be a willing victim. If you have tried to get your property back and they say something like “We can’t let you onto the premises” or “You’ll have to pay a $25 storage fee” or “You’ll have to sign a release.” That’s all bullshit. Call them on it.