Auto Trader Rights constitute the following factors:
Seizing the Car
In many states, your creditor or lessor has legal authority to seize your vehicle as soon as you default on your loan or lease. Because state laws differ, read your contract to find out what constitutes a default. In some states, failure to make a payment on time or to meet your other contractual responsibilities are considered defaults.
If your creditor or lessor has agreed to change your payment date or any other contractual obligations, it’s possible that the terms of your original contract may no longer apply. Such a change may be made orally or in writing. It’s best to get any changes in writing because oral agreements are difficult to prove.
If you default on your loan, the law in most states allows the creditor or lessor to repossess your car. In some states, creditors or lessors are allowed on your property to seize your car without letting you know in advance.
At the same time, the law usually doesn’t allow your creditor or lessor to commit a breach of the peace in connection with repossession. In some states, removing your car from a closed garage without your permission may constitute a breach of the peace.
Creditors or lessors who breach the peace in seizing your car may be required to compensate you if they harm you or your property.
Selling the Car
The sale of a repossessed car must be conducted in a commercially reasonable manner—according to standard custom in a particular business or an established market. For example, the sale price might not be the highest possible price—or even what you may consider a good price—but a sale price far below fair market value may indicate that the sale was not commercially reasonable. Depending on state law, failure to sell the car in a commercially reasonable manner may give you either a claim against your creditor or lessor for damages or a defense against a deficiency judgment—a court order mandating you to pay the debt you owe.
