Can I Get My Repossessed Property Back?
If you have fallen behind on loan payments, any property that you have as collateral could be seized by a bank or other type of financial institution. Your lender is legally required to give you time to “cure” the loan. In simple terms, making your loan current before the property is repossessed is the simplest way to ensure that you keep your asset.
In this blog, our SC repossession lawyers discuss everything you need to know about repossession and the benefits of filing bankruptcy.
Secured vs. Unsecured Debt
Debt can be either secured or unsecured. Secured debt uses collateral, allowing the lender to seize the property if you default on the loan, while unsecured debt is not backed up by collateral. A car loan is usually secured debt since most lenders require that you put your vehicle as collateral to obtain the loan, while student loans are unsecured debt. Regarding secured debt, any action that breaks the contract with your lender places you at risk of having your property seized.
Defaulting on a Car Loan
Traditionally, most of us associate missing payments with defaulting on a loan. However, any failure to make payments in accordance with the terms set out in a promissory note is considered default. This may encompass failing to maintain auto insurance, taking the vehicle out of state permanently, or damaging the vehicle to the point that it has a reduced value.
Repossession Process in SC
It is important that you understand your rights as a consumer. South Carolina law requires lenders to follow a specific timeline to initiate the repossession process. Your lender cannot begin the repossession process until your payment is at least 10 days late. At this time, your lender will send you a Notice of Right to Cure. After receiving this notice, under SC Code §37-5-111, you will have 20 days to catch up on your missed payments, or your lender reserves the right to seize your property or require that you pay the unpaid loan balance.
While most lenders are required to send a Notice of Right to Cure, federal credit unions are exempt from this law. Additionally, if you have defaulted on your loan in the past, your lender is not required to send you another notice for future nonpayment.
Can I Get My Property Back After it is Seized?
It is possible to get the property repossessed back, although you will only have 10 days to do so. After your property is seized, the lender will send you a Notice to Redeem telling you what actions must be taken to get your property back. This may require that you pay the entire balance of your loan plus any repossession costs.
Understandably, if you have fallen on hard times, you will likely be unable to rectify the situation. If you find yourself strapped for cash, either due to a medical emergency that resulted in medical expenses or unemployment, our SC repossession lawyers may recommend that you file for bankruptcy. If you are looking to wipe the slate clean, then a Chapter 7 filing may be right for you. If you earn a regular wage, then you may consider debt consolidation, which is available under Chapter 13 bankruptcy. Both types of bankruptcy prevent your creditors from seizing your property to collect debt in what is known as an automatic stay. Our repossession attorneys can access your financial picture to determine which filing may be right for you.
Consult with Our SC Repossession Lawyers Today
Having your property repossessed can be terrifying, shrouding you in a sense of hopelessness. At Reed Law Firm, P.A., our SC repossession attorneys want you to know that not all is lost. We provide compassionate counsel, presenting solutions in a nonjudgmental atmosphere. To learn more or arrange your free consultation, contact us online or by phone.
