One of the most frustrating aspects of owing a significant amount of debt is the efforts made by creditors and debt collectors in Tennessee and elsewhere to get money from you. Even if you are unable to pay, they will continue to call, send letters and take other steps to collect payment. One of the things some creditors may do is proceed with the repossession process. If this happens, it is possible you could lose some of your personal property.
If you are facing the threat of repossession, it is likely because you are behind on your payments. If the creditor gets approval to move forward with this process, it means someone could take specific things you purchased on credit, including vehicles, furniture and more. It can feel overwhelming to consider the possibility of losing your property, but there are specific legal options available to you that could halt the collection efforts.
The repossession of a vehicle
Technically, a creditor can move forward with the repossession process as soon as one misses a payment. Each car loan should outline what counts as a default, which can be after even just one missed payment. Your vehicle is the collateral for the car loan, meaning you could lose the vehicle if you fall behind on your obligation to the loan company. Typically, the creditor will notify the debtor of the initiation of repossession. There are few things you could do if you are in danger of losing your vehicle:
- You could offer to voluntarily surrender your vehicle. If you have no way to make a payment, this is a reasonable course of action for you.
- You have the option to reach out to your lender to discuss a possible payment deferral or other options that will be satisfactory to both parties.
- You could explore the option of refinancing, a process that could result in lower, more manageable payments for you.
Finally, you could explore the option for bankruptcy. This process will provide you with the benefit of the automatic stay, which halts all creditor contact and collection efforts. The automatic stay will pause the repossession process as well. Bankruptcy also provides financially overwhelmed consumers the opportunity to deal with certain types of balances once and for all. It may be helpful to you to learn about this process and how it could be helpful in your individual situation.