My Car was Repossessed. Where is my Car?
Selling the car
Money owed after repossession
After the finance company repossesses the car they have an obligation to sell the car in a reasonable car in a reasonable time. This can be at auction or at a private sale. Under some circumstances they can keep the car and waive the deficiency.
Under New Jersey law, a company repossessing a vehicle is not entitled to breach the peace while repossessing the vehicle. This means that the repossession company cannot break any specified local, state or federal law while repossessing your vehicle. As an example, if one were to prohibit the repossession company access to the vehicle and the repossession company were to assault or otherwise cause bodily harm to the individual objecting to the repossession, this would be a breach of the peace for which the repossession company and the finance company who contracted the repossession would be liable. This breach of the peace/non-delegable theory assures that the party who is ultimately benefiting from the repossession is subject to all the liabilities and the downsides of this repossession. It is only fair to charge the finance companies who are attempting to retake the vehicle with properly investigating and assuring that the vehicle is repossessed in a commercial and reasonable and proper manner under all applicable state and local laws.
Generally speaking, the finance company, even if small or large finance companies must act reasonably. The Uniform Commercial Code as a specific requirements for pre-sale notice of repossessed vehicles. Uniform Commercial Code for post-sale notices after the sale of the repossessed car has specific requirements.
The finance company has to dispose of the vehicle in a commercially reasonable manner. If the finance company does not dispose of the car in a commercially reasonable manner, they can be sued for statutory damages under the Uniform Commercial Code.
Commercially reasonable varies depending on the circumstances. An example would be the following: a car is repossessed in Arizona and resold in Maine. When it was resold in Maine it was sold and a lot that only sells lawnmowers. This is an extreme example but is used to explain the absurd. Certain things cannot be done when disposing of repossessed cars. What must be done on the disposition of repossessed cars must be done reasonably.
Generally speaking, reasonable is disposing of a vehicle by way of a commercially excepted auction such as Manheim. Sometimes lenders will return the vehicle to the selling dealership and have the selling dealership sell it on their life. This could be unreasonable, but it would vary depending on the facts in the case.
Repossessed cars must be sold in a reasonable fashion in a reasonable time in a reasonable manner.
If the finance company does not comply with this requirement under the Uniform Commercial Code they could be sued for wrongful disposition of the vehicle.
The New Jersey Consumer Fraud Act also applied to the repossession practices the finance companies. If the finance company makes false, affirmative statements to the owner of the vehicle this could be actionable under the Consumer Fraud Act. There are potential conversion claims against a finance company. There are other claims wherein a person who had the vehicle repossessed could assert that the repossession company dispose the vehicle and the deceptive fashion. These are potential claims under the Consumer Fraud Act in addition to the Uniform Commercial Code and the claims thereunder.