When consumers borrow money from lenders to finance their vehicles or mobile home purchases, they provide their vehicles or homes as collateral. If a borrower defaults on a loan, the lender has recourse to repossess the vehicle or mobile home. State laws establish the respective rights of borrowers and lenders in the case of default. In the commonwealth of Pennsylvania, creditors can repossess collateral upon default must comply with the commonwealth's consumer protection laws.
Peaceful Repossession
Under Pennsylvania law, lenders can repossess mobile homes if they do so peacefully and comply with local ordinances and nuisance laws. They may not use force or threaten violence during the repossession, but they are able to repossess the mobile home on the borrower's private property, in garages or in storage facilities.
Notice
Pennsylvania law allows banks to repossess personal property such as vehicles without notice to borrowers. However, written notice is required when repossessing mobile homes.
Right to Cure
In Pennsylvania, consumers who borrow money to finance a mobile home have a right to cure after defaulting on their loan obligations. If a consumer defaults, her lender must give her 30 days or more to cure her deficiency. If she pays the outstanding debt, her lender cannot proceed with repossession. A lender can charge a borrower up to $50 for attorney's fees and late fees before releasing its claim against the collateral.
Personal Liability
If a borrower does not make his loan fully current, his lender can proceed with repossession and sell the mobile home. If the proceeds of the subsequent sale are less than what is owed, a lender can sue the borrower for the deficiency. But the law also gives the borrower a 15-day right of redemption.
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.
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