QandAs: Autos

What is a repossessed car?

Answer:
A repossessed car is one which was bought under a loan

agreement which has not been fulfilled; when the payments aren’t made (or are late), the lender has the option of taking the property back – or, in this case, repossessing the vehicle.

If you finance your car or buy it in any manner other than outright, you don’t completely own the car until every last penny has been paid. Depending on the repossession laws in your state, the lender doesn’t have to give notice of the pending repossession, and your vehicle can be taken if you’re as little as one day late on your payment.

Some lenders will get a key from you, but your car can also be repossessed from the street or driveway. The cars are taken to a repossession lot, and from there, if you do not have the money to pay off the loan, the car can be sold at auction. Even if that happens, if the car is sold for less than you owe on it, you are still liable for the remaining amount. The lender will try to recoup their loss one way or another. Repossessed cars belong to the lending institution, not to you or the city/state.