What to Do if Your Car is Being Repossessed
Having your car repossessed is one of the most unsettling things that can happen to a consumer. It's one thing to be behind on car payments, but it is far more terrifying to walk outside and discover your new car missing or, worse yet, see the repossession taking place.
While repossession agents are used to confrontation, most people have never had to deal with a person on their own property, trying to take their car. At the same time, most repossession agents do not want to run into consumer during the repossession process. They prefer to have access to the vehicle when no consumer is around, because they know that reduces the risk of a confrontation.
If the repo agent cannot access to the vehicle, they will demand that you give access to the car. This can be scary, particularly if the repo agent is armed or threatens to use physical force. In that situation, events can easily spiral out of control and trigger actions that will be regretted for years.
Michigan's Car Repossession Laws
If you have failed to make scheduled monthly payments on your auto loan or if you are shown not to have car insurance, your finance company has the right to take the car back. They can do this by suing you to get a court order for possession of the vehicle. If the finance company exercised this option, a court officer or a sheriff may take the vehicle back and it will be sold at auction or via private sale.
Financial institutions have a second option. They can send a private tow truck driver to take the car back without a court order. This is commonly referred to as a “repossession” or “repo.” This seems easy enough, but there is an important limitation on this option. Finance companies can only repossess without a court order if they do not “breach the peace.” This means that if a creditor wants to avoid court, it will need to make sure that it does not cause a problem when the car is repossessed. It also means that If the creditor tries to repossess the vehicle without an order, it can always bring a lawsuit later to get the car back.
If a repossession agent shows up at your home, and you know you have not kept up with monthly payments, you may not want to object. You may simply want to turn the vehicle over. If, however, you have good reason to oppose the repossession — such as recent arrangements to defer your payment or you have already satisfied the full loan balance — here are some suggestions that will help preserve your rights and safety.
Rule number one when encountering a repossession agent is to keep calm and collected. If you become upset and hostile, the agent may feel the need to escalate in order to complete the job. By keeping calm, you reduce the chances of violence.
Remember, this is a car, not your child. You already will have to cope with the loss of your ride, poor marks on your credit report, a reduced credit score and difficulty getting another car loan. Even if you're watching your new car get taken away, don't make things worse and risk injury or arrest. If you lose your temper and police arrive, they may view you as a threat. This could mean being arrested, tasered, or shot. Be the calm person in the situation, not an aggressor. If the repossession agent tries to escalate the situation, stand down and seek legal counsel.
Record the Repossession
Once a car repossession starts, stay focused and record important details. If you have a smartphone, take video and photos to help establish key facts. Better still, if you have a spouse, friend or neighbor on the scene, have them take the video while you deal with the repossession. On-the-scene videos are common and provide strong evidence of what was said and done.
These videos can resolve factual disputes that would otherwise boil down to a “he said, she said” argument. A camera will also cause all the participants to think twice about their behavior. Also, participants who know that they are being recorded tend to behave more appropriately.
Object to the Repossession
If you see the repossession agent in the process of taking your vehicle, you have the right to object. While there are no “magic words,” you must state your intent clearly:
- “I object to this repossession.”
- “Do not take my car.”
After you object, the repo agent or police officer may try to convince you to turn over the keys or stand back. If you do not want the car taken, you should make clear that they if they continue, they do so over your objection. You can also inform the repossession agent that the need to leave your property and that they are trespassing:
- “Please leave my property.”
- “You are trespassing, please leave.”
Once you have objected and asked the repossession agent to leave, they no longer have a legal right to continue in the repossession. They might still insist on proceeding, but if so, they are continuing in violation of the law. Any further action to take the car back is a breach of the peace, and therefore illegal.
Call the Police
If you have objected and asked the repo agents to leave without success, it's time to call the police. The job of the police is to maintain the peace and protect people from crime. If the repossession agents have refused to leave your private property they are trespassing, and the police should support your request that the agents leave. But don't be surprised if the police already know that there's a repossession in progress.
Most repossession agents will notify the police before they begin a repossession. Once they arrive on the scene, remain calm, be polite and continue to record the incident. You should let the police know that you have objected to the repossession and asked the repo men to leave. At that point, the police should instruct the agents to leave the scene because they are trespassing.
In some situations, the police may not understand that you have the right to object to the repossession. If so, they may try to convince you to turn over the car or the keys. You have no legal obligation to do this if you have objected. Again, make your position clear that you do not agree to turn over the car, and you object to the repossession. If the police want you to turn over the vehicle, you should not do so unless they expressly instruct you to do so. If you think that they are siding with the repossession agents, you can ask them to make their position clear:
- “Are you instructing me to turn over the car?”
- “Are you saying they have the right to be on my property?”
Even though you are not required to turn over the car, follow any instructions given by the police. Again, this is a car. There is no reason to get arrested, injured or shot over a vehicle.
Ask for Your Personal Items
Last, if the police have not stopped the repossession, ask for your personal property from the vehicle. It might not be easy. The repo agents might claim there was nothing in the vehicle, or demand that you sign a release of liability first. You can avoid these problems by demanding that you be allowed to clear out the car before the repossession agent takes it. If they refuse – and your camera should still be rolling to capture this – make sure that you list off the things that you want to retrieve from the vehicle, and let them know you expect these to be returned. That way, you will have recorded the fact that they've taken your personal property and that you expect those items will be promptly returned.
Ultimately, if your car is repossessed over your objection, Michigan law makes that repossession illegal and places you in a position where you can demand a remedy or possibly the return of your car. Lyngklip & Associates, Consumer Law Center, PLC can offer a free consultation for victims of illegal repossession. Call us today at (248) 965-5751 or fill out our contact form online. We can help you understand your rights and can develop a plan to return your vehicle. The consultation is free and there is no fee unless we are able to recover for you.
- Demand for Return of Vehicle
- Demand for Return of Personal Property
- Demand for Account Statement
Related Pages on Our Site:
Legal Decisions and Statutes
- Hensley v. Gassman, 693 F.3d 681 (6th Cir. 2012)
- Soldal v. Cook County, Illinois, 506 U.S. 56 (1992)
- Montgomery v. Huntington Bank, 346 F. 3d 693 ( 6th Cir. 2003)
- Watkins v. Kanitz, No. 1:03-CV-428 (W.D. Mich. Sept. 24, 2004)
- Smith v. AFS Acceptance, L.L.C., ND Ill. Case No. 11 C 5340 (N.D. Ill. June 1, 2012).
- M.C.L. § 445.915(j) and (k)
- M.C.L. § 440.9609
Other Web Resources