If a person filed chapter 7 and their auto lender did not appear at the creditors meeting, did not issue a re-affirmation of the loan, or request the vehicle be returned, what is the recourse for the lender?
A: If the lender has a secured interest filed with the DMV, and a contract
which contains a right to possession
upon default of the borrower, then the lender's recourse is to repossess the vehicle.
The lender promised to modify a loan and did not.
A: This is not legally actionable, unless the borrower paid something in addition to the loan payments in consideration for the promise. I suspect this may be a dead end.
The vehicle purchaser subsequently stopped making payments on the vehicle. The lien holder has not been able to locate the vehicle to repossess it.
A: The lien holder could contact the sheriff/police and report the vehicle as stolen -- or, it could continue to try to locate the vehicle and repossess it from the borrower.
Is there a statute of limitations on their being able to repossess the vehicle? What recourse does the vehicle purchaser have?
A: There is no statute of limitations, as long as the lien holder upon notice
of a request to transfer the vehicle provides notice to the department that title is being held for nonpayment of the loan. Vehicle Code
The vehicle belongs to the lender, and the lender is not permitted to negotiate a settlement of the debt to release the lien without consent of the bankruptcy court
. This pretty much makes the vehicle unmarketable, but the borrower could continue to register the vehicle as long as the lender does not exercise its repossession rights.
Hope this helps.
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