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Advice and tips to avoid car repossession

My car met with an accident and I don't have enough insurance coverage? Will the car be repossessed?

My friend financed a car for me and i had an accident. She switched to liability coverage prior to the accident. Since the accident in June 2007, we funneled as much money as possible to the auto repair shop and have not made any payment on the monthly note greater than 15% (if that.) I was told over a phone conversation with nissan that they wrote it off as a loss. The mechanic advised me to allow him to put a lien on the car to prevent Nissan from repoing the car. He has recently told me that the lien "did not go through"(?) and that the car may not be there for long because Nissan is trying to take it. MY circumstances are changing and i expect to be able to pay the mechanic's balance and the months of notes that I have not paid. Damage to the car=9,500, mechanic has received 5,500 and my note is 650 per month. What situation am I in? I would prefer to keep my car and somehow continue paying the note. What can be done?

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Bill's Answer
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As the company that financed you car, Nissan has the first lien on the car. There is no way that the car mechanic would be able to place a lien on the vehicle given the fact that you still owe Nissan a balance. What you owe to the mechanic is separate from what you owe Nissan. You cannot club both the amounts together. Even if Nissan did write off the account as a loss, they still have the authority to acquire the asset and will keep trying to do so.

If you wish to keep the car, then you should get in touch with Nissan immediately to discuss your payment options before they actually do repossess the car. It is more likely that they will continue with the loan if you can reach a current status on your past due payments. Believe it or not, they do not want your car; they want the money and will be more than willing to deal with you. They generally lose money on repossession. Once a vehicle is repossessed, the vehicle is auctioned, any remaining balance is charged to the debtor. This includes the cost of the repossession. In all likelihood, you will end up paying more money if you let them repossess the car right now.

As far as the mechanic is concerned, he should not have a problem to release the car once you pay the entire amount that is due to him. If you cannot afford to pay the amount in lump sum, you should try to reach a payment agreement with him as well.

I hope the information provided helps you Find. Learn. Save.

Best,

Bill

www.bills.com

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15 Comments

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  • BA
    Mar, 2010
    Bill
    You should speak with the insurance company involved so they can explain to you how this process works. They should be able to inform you of how the funds get disbursed. You should also contact your auto lender to inform them of the situation and they should be able to advise you on how to deal with the payments.
    0 Votes

  • 35x35
    Mar, 2010
    zaida
    my partner had a car on finance we been paying all payments up to date but a week ago we had a car accident not our fault.the car is a write off.what i wanted to know is the money they pay you for the car do we receive that or does the finance company? we are going to continue paying the payments we make on time but who gets the money for the car?
    0 Votes

  • BA
    Dec, 2009
    Bill
    You are asking what is called in law the Right of Redemption. This right varies by state. You did not include your state of residence in your message so I cannot hazard a guess if this option is available to you.
    0 Votes

  • 35x35
    Dec, 2009
    JB
    I have had a repo done, the case went to court and ruled in favor of the bank (duh). However, I still have the car. It was at my mother's home and they tried once to get the car. It shows the vehicle sold for $0 but what is the deal? Can I have a mechanics lein put on it and have it resold to me or will the bank still have the lein on it?
    0 Votes

  • BA
    Dec, 2009
    Bill
    Go get the vehicle. If you do not the creditor will find it eventually, and charge the signatories to the loan contract the costs to recover the vehicle. See Voluntary Repossession to learn more.
    0 Votes

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