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Mar 21

Key Considerations When You Cannot Make Payments for Your Car Title Loan

Posted by at 22:54 | Default | Comments(0) | Reads(786)

Depending on the state you are in, there are some key considerations that you should have in mind when getting a car title loan. For example, for car title loans Cupertino, you would have to refer to specific guidelines or laws from the state of California.

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Depending on your specific state, different rules may apply. However, generally, the guidelines below should apply.

1.  Guidelines that limit what a lender can do if you default on your car title loan

If you cannot pay your car title loan, your lender has the right to repossess your car. The lender, however, is limited by rules regarding what he can or can’t do in order to recover the loan. These rules can be found in the FDCPA.

The FDCPA is meant to govern what third party debt collectors assigned by a lender can or can’t do in order to recover a debt. However, some states use the rules in this Act to govern and lay a foundation for what any lender can or can’t do, to collect their own loan from a debtor.

The rules in the Act include some of those listed below:

•  No explicit, offensive or lewd language should be used.
•  No physical or emotional threats should be made.
•  The debt collector is not allowed to talk to other people about your debt without your permission.
•  The debt collector cannot pretend to be a lawyer or law enforcement agent.
•  The debt collector can’t contact you in your place of work unless you have given permission for them to do so.
•  The debt collector cannot make a phone call to you before 0800HRS or after 2100HRS

2.  What happens if you cannot pay for the car title loan

If you cannot pay for your car title loan as agreed in the car title loan contract, the only recourse that the lender has is to repossess your car and sell it in order to recover the loan extended to you.

The car title lender should give you, in writing, a 10 day advance notice of their intentions to repossess your car giving reasons as to why they intend to do so and details of what is due to them. If you manage to make payments of what is due before the 10 days, your car cannot be repossessed.

After repossession, you are given an additional 15 days before the car can be sold. This is done through a notice that includes:

•  The date and time when the car is to be sold.
•  The total amount due for the loan including interest up to the day of repossession.
•  Additional fees associated with repossession, but not including storage fees.

If you manage to pay all the due fees before the 15 days, you can still manage to get back possession of your car.

If the car title lender manages to make more than you owe them for the sale of your car, they are obliged to give you the balance that remains from the deductions listed in the 15 day notice. This balance should be given to you within 30 days from the date of the car’s sale.

If after sale of the car the lender cannot recover the loan balance owed, they have no other recourse to force you to pay the balance or to sue you for the balance. A few exceptions to this rule do apply from state to state.

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