Automobiles are repossessed faster than any other property, so if you are behind in your payments, you need to act promptly. In some states, but not all, the creditor must give you notice before repossessing the vehicle. Many states have what is called “right to cure”. That means you have a chance to make up late payments before the car is repossessed.
In some states, creditors include a clause in your finance agreement with a right to accelerate the loan if you miss payments. That means the entire loan balance becomes due immediately. If you live in one of these states, making back payments is not enough unless your creditor is willing to reinstate the loan.
Some creditors will negotiate an arrangement, called a workout agreement that will allow you to keep the vehicle with lower monthly payments. You should talk with an attorney before accepting a workout. Depending on the conditions and your financial situation, it might be better to give up the car voluntarily. If you do this, negotiate with your creditor to release you from the remaining balance on your note in return for saving them the hassle of repossessing the car. The lender has the right to sell the car and sue you for the difference between the amount raised from the sale and the amount that you owe on the loan.
Since repossessed vehicles have a low market value, the difference could be thousands of dollars.
If your car is repossessed, you still have some recourse.
Immediately after the repossession, contact the creditor in writing and request every item of personal property specifically by name that you left in the car.
In some states, you can recover the car by paying only your overdue payments. However, you must act quickly. Cars are usually resold shortly after repossession.
In every state, you can recover your car by paying the full balance of your note prior to the date of the car sale. The creditor is required by law to send you a written notice of the date the car will be sold.