Once your lender repossesses your vehicle, you have a window of opportunity to purchase the vehicle back from your lender. Your auto loan provider may request that you pay off your loan, in addition to late payments and collection fees, or that you pay your past-due amount and additional fees.
Time Frame
After repossession, your lender will send you a letter stating the amount you owe to purchase your vehicle or reinstate your loan. The letter will also state the lender's intent to sell the vehicle and the date it plans to do so. Most repossessed vehicles are resold at auction, often about two to three weeks after repossession. This time frame is the only opportunity you have to purchase your vehicle back from your lender. Once the car is resold, you cannot have the car back unless you purchase it from the buyer.
Vehicle Sale
If you don't collect your car within the stated time frame, your lender will sell the vehicle privately or at auction. A private sale warrants more money than an auction sale, as auction cars are sold at wholesale value. If you owe more than your vehicle's sales price, you must pay your lender for the remainder of your loan balance. If you owe less than your vehicle's sales price, your lender must return the profit to you once it collects the loan payoff amount and deducts for any collection or late-payment fees.
Vehicle Resale
You may find that you can purchase your vehicle for less than you owe on your loan. If you know someone who has a dealer's or wholesaler's license, you may ask that person to bid on your car on your behalf. Most auctions are not open to the public. Auction vehicles are often sold locally, so you may find that you can purchase the vehicle from another dealer after the sale. You might be able find the wholesaler or dealer reselling your vehicle and purchase it. Unfortunately, finding the vehicle might be hard to do.
Balance Due
If your vehicle is sold at auction, you must continue to pay your car loan if your car sold for less than you owed. Although you can't have your car back, you're still responsible for the amount owed on the original loan. You can likely work out a payment plan with your lender for less than your monthly car payment amount. Otherwise, if you don't pay, your lender may eventually sue you and garnish your wages to collect the balance due.
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