The Virginia Consumer Protection Law and Title 6.2 of the Code of Virginia outline the rights consumers have against lenders performing repossessions of their vehicles. The Virginia Code requires lenders to disclose their rights in their written loan contracts before they can legally repossess their vehicles. If they fail to disclose their rights to repossess, they cannot proceed with repossession.
Written Notice
Effective October 1, 2010, the Virginia Assembly passed legislation requiring lenders to send borrowers a default letter before attempting to repossess their vehicles. The lender must send a written notice by first-class mail at least 10 days before repossession. The notice must state the amount of principal and interest due and owing, and alert the borrower of default and provide him with notice of the lender's ability to repossess the vehicle if the buyer does not pay the entire delinquency by a prescribed date.
Repossession
If the buyer does not pay the entire amount owing in principal and interest, the lender can repossess his vehicle. However, the lender cannot sue for any remaining loan obligation and the costs of repossession if he does not provide the written notice at least 10 days in advance of repossession. At least 15 days before selling the borrower's repossessed vehicle, Virginia law requires lenders to notify the borrower of the time and date of the vehicle sale; a written account of the amount due and interest charged through the date of repossession; costs of repossession; and the costs of preparing to sell the reclaimed vehicle. During the period after repossession but before the sale, the lender must give the delinquent borrower a right to redeem his vehicle.
Right of Redemption and Right to Surplus
Under Virginia law, borrowers have a right of redemption to reclaim their vehicles before the sale date if they pay all expenses due, including the costs of repossession, principal, interest, expenses incurred to advertise the sale and any other preparation costs. Additionally, Virginia allows buyers to receive any surplus funds obtained from sales if they do not exercise their rights of redemption. Lenders must return any overage after deducting for interest, the principal loan amount, reasonable expenses and sale costs. Lenders have 30 days from the date of auction or sale to send their proceeds.
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.
My vehicle was repossessed without any notice, written or otherwise. One payment is past due and another is now due, but not officially past due. The repo man had no papers for me to sign or keep.
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