When you are facing financial difficulties and are unable to make your car loan payments, you will surely worry about your car being repossessed. Yes, losing your car is very frustrating. However, if you fail to make one or more car loan payments, the lender will seize your car through the repossession process. Each state has its own laws and regulations that govern the repossession process. If you live in Idaho, you should know and understand the Idaho repossession laws. Well, in this article, we will give you an overview of Idaho’s repossession laws, the vehicle repossession process in Idaho and how you can protect your rights during the repossession process.
Idaho Repossession Laws
Repossession is the process of taking back a car after the car owner fails to make car loan payments. Each state, including Idaho, has its own laws and regulations that govern each step of the repossession process. Repossession laws in Idaho protect the car borrowers from their rights and require the car loan providers to comply with the repossession laws. If the car owner fails to make the car loan payments, then the car loan provider has the right to carry out the foreclosure process. Whenever a car is seized, usually the car loan provider will sell the car through a car auction. If the amount of money obtained through the car auction cannot cover the payments due, then the debtor will still have to pay the deficiency balance.
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How Many Payments Can Be Missed Without Risking Repossession?
When you make a car loan, you will be asked to sign a car loan letter, which means you have a secured debt. The car is the collateral that secures your loan. In this case, the car lender has a legal right in the car loan. The legal right gives the car lender the ability to seize your car if you fail to make your car loan payments by missing car loan payments, paying the car loan late, or violating the terms of the contract such as not having proper insurance coverage.
Under Idaho’s repossession laws, once a debtor misses one car loan payment, then the creditor must send a written notice to the debtor. In the notice, the creditor must explain that the debtor has 10 days to make the missed auto loan payment or the car will be repossessed. It means that if you do not make the car loan payment within 10 days after receiving a written notice from the creditor, then be ready for your car to be repossessed. To get your car back, you must pay off the car loan in full.
Is There a Notice Before Repossession?
Idaho’s repossession laws states that the car lender must send you a notice explaining how much of the late car loan payment you owe. The notice also explains that you must make the missed car loan payment within 10 days. If you do not make the car loan payment within 10 days, then your car will be repossessed. So, before the car repossession, you will first receive a notice from the car lender. If you have received the notice, make the car loan payment immediately.
How to Prevent Car Repossession?
To prevent car repossession, you must make regular payments. Make sure you always pay your car loan in full. To know when a car loan payment is considered late, check the terms of your car loan agreement. If you are already past the payment date, also check the terms of your car loan agreement to see if you have a grace period to make late car loan payments. Usually, some car lenders give a grace period to car borrowers. That way, after the due date, you still have additional time to make the car loan payment without being considered late.
If you fail to make a car loan payment, the creditor will send you a notice asking you to make the payment immediately. Do not panic, you still have 10 days to make your car loan payment to avoid car repossession. Therefore, make sure you pay off your car loan in no more than 10 days. To make the payment, you can use your remaining savings or use emergency money. If this is not possible, you may try borrowing money from your parents or relatives instead of having your car repossessed.
Apart from the repossession step, you should also talk to your car lender about your problem, and ask if you can get an extension of time to make the car loan payment. Some car lenders may be willing to work out an alternative payment plan. However, this option is usually exercised by car lenders if you contact them before you fall behind on your car loan payments.
What Repo Companies Can Do in Idaho?
Once you fail to pay the car loan within 10 days as requested by the car lender in the notice letter, the car lender will seize your car. To conduct a car seizure, car lenders can do it themselves. However, most car lenders usually hire a repo company to do the car seizure. If your car lender is working with a repo company, the repo company does not need to give you any additional notice that they are going to impound your car. That means, your car can be repossessed at any time without any prior notice.
Speaking of repo companies, the state of Idaho has rules about what repo companies can and cannot do. Here is the explanation:
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- The repo companies cannot enter your garage or home without your permission to seize the car. However, the repo companies can enter your property to take the car if it is somewhere like a driveway. Moreover, they can also impound cars from public places such as roadside parking lots.
- Repo companies must not commit public order offenses such as committing violence or threatening violence to seize your car.
- Repo companies should not commit fraud to repossess your car such as giving a fake recall notice asking you to take the car to a repair shop and then impounding your car from the repair shop. However, if you take your car to the repair shop yourself for repairs, then the repo company can impound your car there.
If the repo company commits any of the above actions, then you should not hesitate to contact a lawyer for help in filing a claim against the repo company. You can contact the lender if someone takes your car when you have already paid off the car loan payments. In addition, you can also contact the car lender if your car was impounded without prior notice. Unfortunately, you cannot ask for proof of the repo company’s license as Idaho does not require repo companies to be licensed.
Just as the repo company cannot violate Idaho’s laws and rules regarding repossession, you as the debtor cannot commit offenses such as committing or threatening violence to the repo company when they want to seize your car.
What About Your Personal Belongings If Your Car is Repossessed?
Car repossession is a pain in the ass. However, you cannot do anything else if your car must be repossessed because you failed to make a car payment. When you feel that your car will be impounded, you can immediately remove your personal belongings from the car. This is to save you time in case your car gets impounded suddenly.
If your car is repossessed with your personal belongings still inside, usually the repo company will tell you how to get your personal belongings back. Under Idaho law, the repo company can take your personal belongings and store them properly. However, they will usually charge you a storage fee. To retrieve your personal belongings that have been stored by the repo company, you can make an appointment. Do not forget to prepare money to pay the storage fee. Under Idaho law, there is no stipulation on how many days the repo company must give you to retrieve your personal belongings.
What Happens After Car Repossession?
After the seizure of your car, the car lender will then sell your car at a public auction. Usually, at public auctions, confiscated cars are sold at a lower price. Before the repossession, usually the car lender will give you a notice about the auction. Until the auction takes place, you as the car owner have the right to get your car back through car redemption. Therefore, if you do not want your car to be owned by someone else, you must redeem the car.
If you do not redeem your car, and someone buys your car at a public auction for less than what you owe, then you still owe the car lender. It means that you must pay off the remaining balance. This is called the deficiency balance. The deficiency balance is calculated by adding up what you owe on your car loan, plus repossession fees or other costs. Then, subtract the amount of the car sold at the public auction. For example, if you owe $10,000 for a car and the repossession fees are $2,000, then you will owe $12,000 minus the auction sale price. Now, if your car sold for $8,000 at the public auction, then your deficiency balance would be $4,000. That is $12,000 you owe minus the $8,000 your car sold for.
Idaho law makes it a rule that car lenders must sell the impounded car in a reasonable and commercial manner. That means the car lender must adequately advertise the sale of the car. The car lender must also sell the impounded car at a fair market price. You can raise a defense if the car lender does not sell your car in a commercially reasonable manner but demands you to pay the deficiency balance. If you are successful in your defense, you may not have to pay all your deficiency balance.
You can raise a defense if:
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- Your car was not seized properly.
- The car lender who conducted the foreclosure damaged your car and lowered the resale value of your car.
- The car lender did not sell your car in a commercially reasonable way.
If you owe more than your car is worth at auction, the car lender will sue you for the shortfall balance. If the car lender successfully wins the lawsuit, then they will receive a judgment for your deficiency balance from the court. The judgment is a court order asking you to pay the remaining deficiency balance.
Do I Still Owe Money After the Car Seizure?
After your car seizure process is complete, your car will then be sold through a public auction. Usually in public auctions, cars will be sold cheaply. Well, if the proceeds from the sale of your car cannot cover your debt, then you will have to pay the rest of your car loan. In addition, you will also be required to pay the repo company’s fees and other fees listed in your car loan contract. Therefore, to reduce the money you must spend, you should voluntarily surrender your car. Yes, you will not get rid of the balance of your car loan debt, but by voluntarily surrendering your car, you will not have to pay the repo company fees.
Can I Get My Car Back After Repossession?
Yes, of course, you can get back your car after repossession. After your car has been repossessed by the repo company, you can get your car back by paying the full amount of your overdue car loan. Also, you need to pay the repo company’s fees. So, after your car is repossessed, if you want to get your car back, you must immediately prepare a sum of money to pay off the car loan repayment and pay the repo company’s fees. Yes, it is hard for getting money quickly, but you may be able to sell your other assets to get the money. Or you may also try borrowing money from your parents or close relatives. It is up to you, you make your own decisions, and know what is best for you. Please note that the state of Idaho does not provide rules on when an auction takes place after a car has been repossessed.
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On my daily job, I am a software engineer, programmer & computer technician. My passion is assembling PC hardware, studying Operating System and all things related to computers technology. I also love to make short films for YouTube as a producer. More at about me…