What are the options with a Repo?

[PoorManQ45]

My friend defaulted on a loan for a ATV.

The repo man showed up last night.

What are the options?

If the bike is returned I know that you have to pay the difference between what is owed and what the atv sells for at auction, correct?

What I don't know is, what happens if the lender is unable to recapture the vehicle? What options will they have against you?

*edit* What happens if you don't give the vehicle back?
Modified by PoorManQ45 at 10:52 AM 11/6/2009

[Koshin]

the balance will go to a collection agency and depending on the amount owed, your friend could be sued for the full amount owed...it depends on the state he lives in and the laws there...they change state to state

[PoorManQ45]

This is in Florida

[Isr]

Time to move to a non-extradition country

[Koshin]

IIRC, Florida and Texas have very lenient laws with this sort of thing...look up the laws for your state..

and Im pretty sure Im correct about the above

[Koshin]

....OK, I just remembered that FLA and TX have laws against wage garnishments...so if he does get sued and lose, the state cant garnish your wages

[PoorManQ45]

What course of action should he take?

The vehicle is located in a nondisclosed location, so it wont be repoed unless he chooses

[numbnuts240]

he could try paying his bills.

[PoorManQ45]

I agree...

[IanS]

Ive worked with repo guys.

The easiest solution is to contact the bank. If the repo guy is at your door, it means you have not been paying for a minimun of 3 months, (here in MN). Just get in contact with the bank, and work out a payment plan. Especially with the economy, banks are happy to get anything.

Repo guys are wiley, chances are, they will find it. No matter how well you think its hidden, they will find it. Not to mention, good luck using it when its all shut up somewhere.

The repo guy is just the 1st weapon in a banks arsenal. If they have no success recovering the vehicle, they will often move on to a civil suit. They will bring the courts on those named on the contract. They can garnish wages, and wreak all sorts of havoc. If that doesn't work, they will often enlist local police to issue a warrant for the owners arrest due to breach of contract.

Just pay up, or give it back. Banks have way more time, manpower, and resources than your friend does.

[PoorManQ45]

If that doesn't work, they will often enlist local police to issue a warrant for the owners arrest due to breach of contract.

Prior to a legal judgment are you obligated to pay the loan back? Meaning can they actually get a warrant prior to a legal judgment against you?

[IanS]

Prior to a legal judgment are you obligated to pay the loan back? Meaning can they actually get a warrant prior to a legal judgment against you?

When I was helping out with recon, often times we would find vehicles sitting locked in garages, with owners not driving them, but also not willing to give them up. Many times we would just call local PD, and have them send an officer out. 9 times out of 10, after a little chat with an officer, the owner would just hand over the keys. I dont know the laws exactly, and its different state to state, but the outcome is the same. Just pay up, or give it back.

[PoorManQ45]

Well, he's trying to figure out what the best option is.

He might be able to sell it for more then they'll sell it for at auction. If he chooses that route what happens?

What i'm wondering, the debt hasn't gotten to a collections agency. When it gets there I know that the bank sells the debt for a loss just to get any money back. Then the debt collectors try to squeeze anything they can from you. Usually at a much lower amount as they bought the debt for much less then the face value.

Should he let it go that far? If it does, he could sell it for cash, then use that to pay of the collections agency in full.

I mean, his credit is probably shot already because of this, he's just trying to save money from the outcome now.

[yelnatsch517]

What are the options?

For you:Get a new friend.

For him:Whatever ^^they said.

[IanS]

Well, he's trying to figure out what the best option is.

He might be able to sell it for more then they'll sell it for at auction. If he chooses that route what happens?

What i'm wondering, the debt hasn't gotten to a collections agency. When it gets there I know that the bank sells the debt for a loss just to get any money back. Then the debt collectors try to squeeze anything they can from you. Usually at a much lower amount as they bought the debt for much less then the face value.

Should he let it go that far? If it does, he could sell it for cash, then use that to pay of the collections agency in full.

I mean, his credit is probably shot already because of this, he's just trying to save money from the outcome now.

There is a problem with this theory. A 4 wheeler, like most other motor vehicles, must be registered. If the bank is after the vehicle itself, and not just the owner, then it is likely a secured loan, meaning they have a lean on the title. If there is, then he will not be able to sell the vehicle without a release from the bank.

Generally speaking, banks dont sell secured loans to collections agencies. Because there is collateral, they will farm it out to a recovery agency. These are the guys who show up at your door.

Im guessing your friend is just screening his calls, and ignoring his mail.

He needs to contact the bank, they are almost always willing to work with people, they are hurting right now as well, and would rather just work things out, as apposed to loosing money on a forceful recovery.

[PoorManQ45]

Alright, it is a secured loan.

I didn't know they wouldn't sell the loan.

What does he do to contact the bank? It is HSBC that the loan is through. Does he just call up and say, "hey, I want to negotiate", or can he do this through the people that are calling?