If you allow your lender to repossess your leased vehicle, the process is known as an involuntary repossession. Unless you arrange to bring your vehicle back to your lender, known as a voluntary repossession, the vehicle can be taken from just about anywhere. You may also have an opportunity to purchase the car from your bank.
Collection Procedures
Your bank will try to contact you before repossessing your leased vehicle. To avoid the involuntary repossession process, you should respond to any correspondence from your lease provider. Your leasing bank may have programs in place to help avoid repossession. If you do not respond to your bank, it will begin the collection process and make arrangements to seize the vehicle. You can also arrange to bring your vehicle back to a bank preferred location to avoid a potentially embarrassing situation.
Involuntary Repossession
Your bank hires a repossession company to seize the vehicle after attempts to collect payments have failed. The hired company can take your vehicle from your place of employment, a driveway or even a parking lot while you're shopping. Unless you're present when the vehicle is seized, you'll have to make arrangements to obtain your belongings from the vehicle. If you aren't sure where your vehicle is located, call your leasing bank or local police department to determine its location. Call the repossession company and make an appointment to obtain your belongings.
Lease Purchase Opportunity
Getting your leased vehicle back is difficult. Your leasing bank may offer you the opportunity to pay your past due amount and collection fees to continue leasing. Most leasing banks, however, require the vehicle's entire value in full, so expect to forfeit your leasing option if you plan to get your vehicle back. You'll have to obtain a loan for the vehicle's purchase value and collection fees, which is difficult since your lease has been reported as past-due and repossessed to the credit bureaus.
Credit Reporting and Payment
Your involuntary repossession is reported to the credit bureaus almost immediately after repossession occurs, which affects future credit opportunities. Expect the repossession to remain on your credit report for at least 7 years. Once your car is collected, the bank resells it within a few weeks. Expect a letter stating how much you owe toward your vehicle's total value, not its lease amount. You must pay your bank for its loss over the car's sale price, or the bank may sue you and garnish your wages.
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