If you get behind on your payments and debt begins to pile up you may be asking yourself if creditors can come and repossess your assets. It is important to know that there are strict rules and guidelines that define what creditors can and cannot repossess if you happen to get behind. While these laws can vary from state to state, generally speaking, creditors are required to follow strict laws when it comes to repossession.

What is repossession?

Repossession is defined as the retaking of something when a buyer falls behind on payments. Many states allow creditors to complete a repossession without court order so long as it is without breaching the peace. Meaning, the creditor cannot use bullying tactics such as making threats or use physical force against you in order to complete the repossession. If the creditor breaches the peace by doing so, you can file a lawsuit against the creditor. If peaceful retaking isn’t possible, the creditor must get the courts involved using what is called a “replevin process” to get a court order to retain the property.

What items can be repossessed?

If you fall behind on payments and have defaulted, certain items can be repossessed by creditors. Under most agreements, creditors can take property pledged as collateral without going to court. Below is a list of items that can be repossessed if you get behind on payments:

Your car can be repossessed

Rent-to-own items can be repossessed

Property used as collateral can be repossessed

What items cannot be repossessed?

Without a security interest in an item or property, creditors cannot take anything without court order or approval. It is important to note that a creditor can file a lawsuit to recover the money you owe. If the creditor receives a favorable judgement, the creditor can garnish your wages, put a lien on your property, or seize and sell your property. Below is a list of items creditors cannot repossess:

Property not listed as collateral cannot be repossessed

Credit Card purchases cannot be repossessed

Property named as collateral in an unenforceable contract

If you have gotten behind on payments and are worried about your items or property being repossessed by creditors it may be time to seek legal counsel to explore your options. We encourage you to take a proactive approach to get ahead of costly legal issues. You may be able to enter into debt renegotiations and avoid repossession.

Schedule a consultation with us to explore your options

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