Under California law, repossession agencies hired by car owners must have valid licenses to repossess issued by the California Bureau of Security and Investigative Services. However, California law does not require banks, financial institutions and other legal owners to obtain a license before they can reclaim their collateral. In-house employees or owners can conduct repossessions without licenses since they are not third-party agencies.
Rights
California law requires repossession agencies to follow different guidelines than owners of repossessed vehicles such as banks. Banks, financial institutions and other owners may comply with a less restrictive set of repossession laws. Finance lenders and repossession agencies can conduct repossessions while the borrowers are physically present, and it is against California law for borrowers to attempt to thwart their repossessions. Additionally, under California law, it is illegal for borrowers to attempt to hide their vehicles, and garage owners and storage facilities must notify the local police department of all new vehicle storages. California law allows vehicle owners to repossess their cars and exercise their ownership rights after one missed payment. The state will allow owners to exercise their contract rights if both parties --- buyer and seller --- entered into a binding contract.
Police Notification
Both repossession agencies and finance lenders have a legal duty to notify the local police department within one hour of repossession. The notification to buyers rule is different for repossession agencies. Although repossession agencies are legally obligated to notify borrowers within 48 hours of repossession, finance lenders are not. California law requires repossession agencies to send a "Notice of Seizure" within 48 hours after repossession.
Personal Effects and Sales
Finance lenders and repossession agencies have bailment duties, and they must store personal items left in vehicles for 60 days, but after that period, they may throw them away or sell them. Lenders do not have to keep an inventory list of the personal belongings, but repossession agencies must keep inventory lists of items found in the car and if these items were sold or thrown away.
Acceleration Rights
Under California law, repossession agencies must provide borrowers with redemption rights to repurchase their vehicles after paying the amount due and owing at the time of repossession. However, banks that repossess can accelerate the terms of their sales contracts if borrowers committed fraud by using false information on their credit applications or attempted or threatened to destroy their vehicles. Banks may also accelerate contracts if their cars were used in the commission of a criminal act or the buyer committed or threatened the bank with violence during repossession. Last, banks can demand full payment if the borrower damaged or threatened to damage the vehicle.
Considerations
Since state laws can frequently change, do not use this information as a substitute for legal advice. Seek advice through an attorney licensed to practice law in your state.
0 comments:
Post a Comment