Most people in Connecticut realize that those who provide automobile loans have the right to repossess the vehicle if the borrower does not make timely payments.
However, what they might not realize is that borrowers have rights during the repossession process, and lenders have to meet certain obligations that respect to these rights.
Repossession with prior notice
A lender may elect to notify the owner of the car of an impending repossession.
The notice has to have certain information in it, including exactly what the reason for the default is. The reason must be permissible under both the contract and the law. For example, lenders are not allowed to repossess because the borrower filed for bankruptcy.
The loan contract must also specifically spell out that repossession is a possibility if the borrower defaults. This applies to each obligation that a lender might use to justify repossession.
The notice also has to be hand-delivered or sent via certified or registered mail.
The drawback to this notice is that it requires a lender to delay repossessing a vehicle. On the other hand, after giving notice, a lender may repossess and move immediately to selling the vehicle at an auction.
Repossession without notice
Lenders also have the option to simply take a vehicle without notice. However, if they do so, then they must hold the vehicle within the borders of Connecticut and give the buyer 15 days to pay the balance due on their loan plus any costs connected with the repossession before moving forward with a sale.
The lender must provide these figures via certified or registered mail within 3 days of repossessing the vehicle.
Finally, the lender has to give instructions to the borrower about how to retrieve any personal property from the vehicle.
In both types of repossessions, legal issues may also arise in connection with the sale itself.