subject: What Are Your Rights When Your Property Is Being Repossessed? [print this page] What Are Your Rights When Your Property Is Being Repossessed?
Some of the times when buying merchandise, you will have the need to take out a loan from the person or entity from which you are purchasing the merchandise. For example, you typically take out a loan from the dealership when purchasing a new car. Or when buying an expensive furniture set, you may take out a loan from the furniture store. Or, you may even take out a loan from a friend who sells you a lawn mower in return for monthly payments.
In all the above mentioned cases, depending on the small print in the contract that you signed, if you fail to make the payments as specified, the original owner has the right to repossess the merchandise.
The majority of the time when a company is force to repossess merchandise from someone, it is because that person has lost a job. But, whatever the cause, if you are having trouble making payments or if you actually fall behind in making you payments, you should contact the creditor as soon as possible.
This is helpful in two ways. One, it demonstrates good faith on your part by showing them that you are not attempting to cheat them out of what they are owed. And, two, it gives you an opportunity to make an alternative payment plan, one that will be easier for you to adhere to and that will allow you to keep possession of the merchandise.
Keep in mind, however, that if you item you purchases is repossessed, you may still owe money on it. This is because in the course of taking out the loan and having the item repossessed, you have incurred a number of charges. For instance, you will be charged for any repossession cost incurred. You will be responsible for any late fees. The dealer will, no doubt, resell the car, but you will be responsible for the difference in the amount that you owe on the loan and the amount that they sold the car for. In other words, just because you don't have the merchandise, doesn't mean that you get to pay nothing. And, this is the reason why, if at all possible, it is best to try to call the creditor and try your best to work out a payment plan that is acceptable to you both.
There are times, however, when you find that you are so much in debt that you know you will never be able to bring your payments to the creditor up to date. In this case, a valid option is to try to resell the merchandise yourself for as much as you can and use the proceeds to pay down the loan. Alternatively, it is better for you to simply allow the repossession as soon as possible to avoid the ancillary charges from adding up.
