When a car owner falls behind on payments, the lender may resort to repossession as a means to recover the vehicle. In South Carolina, car owners facing this situation may wonder about how the process works and what they can do about it.
The law establishes certain rights for car owners and those who repossess vehicles to ensure a fair and transparent process.
No court order requirement
Lenders can repossess a vehicle without court involvement. However, they must adhere to specific guidelines. They must provide a Notice of Right to Cure before taking any action. This notice includes details about the missed payments and the amount due. It also provides a grace period of 20 days for the owner to make payments and avoid repossession. If the owner brings payments current, the lender cannot move forward with seizing the vehicle.
Once the repossession happens, car owners still retain certain rights. Lenders must provide a notice of intent to sell the repossessed vehicle. This notice outlines the date, time and location of the sale. Car owners have the right to attend and bid on their vehicles.
Lenders must sell repossessed vehicles in a commercially reasonable manner. The sale should happen in a way that maximizes the value of the vehicle. The proceeds need to go to the outstanding loan balance. If there is a surplus after the sale, the car owner may have rights to the money.
Vehicle owners should understand repossession and their rights. It can make the process easier and could even help them to avoid losing their vehicle.