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Loren, Lawyer
Category: Consumer Protection Law
Satisfied Customers: 28537
Experience:  30 years experience in general legal matters.
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My son lives in Montana. He bought 2 cars from a buy here

Customer Question

My son lives in Montana. He bought 2 cars from a buy here pay here lot. The Audi was repossessed and he paid off the Hyundai vehicle. The dealer is telling him he needs to now pay for the Audi that was repossessed 3,000.00 or they will also repossess the car he just paid off. His name is ***** ***** Hyundai only and his girlfriend and he are on the Audi loan that they defaulted on.
I thought each car is collateral for each loan. Can the lender make him pay for the defaulted loan or take both vehicles?
Submitted: 4 months ago.
Category: Consumer Protection Law
Expert:  Loren replied 4 months ago.
The only way the other car may be repossessed for a default on the Audi is if the financing cross collateralized both cars. In other words, title is not really relevant. It is the financing or security agreement. If it includes both cars as the collateral for the loan, or if the Hyundai security agreement references a breach in the Audi financing as a breach in the Hyundai loan then the can repossess the Hyundai for the Audi breach. Otherwise, it would be unlawful and expose the repo company and the dealer to civil and, potentially, criminal liability.

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