Requirements for Repossessing in Illinois

In Illinois, repossession law falls under the state's Uniform Commercial Code, the Motor Vehicle Retail Installment Sales Act and the rules set forth by the Secretary of State. Repossession usually refers to vehicles and not household goods, as the resale cost of household products is often not worth the creditor's time. If you are in danger of defaulting on your loan, your creditor can repossess only under state-mandated circumstances. Security Interest and Legal Default An Illinois vehicle may be repossessed only if the creditor has a...

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How Do Car Title Loans Work Through Banks?

Financial institutions offer car title loans to consumers who need to get cash quickly and have no other sources. The loan process and the requirements are similar to those for vehicle financing. When applying for a title loan, a consumer must present a clear title for the vehicle he is using as collateral. Car Loan vs. Title Loan Car loans and title loans are similar but serve different purposes. A car loan finances a vehicle. A consumer uses proceeds from a title loan for his personal needs. A vehicle serves as collateral for these loans....

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What Happens at the End of My Car Lease?

Lease-end procedures differ slightly by bank. Your leasing bank should provide instructions for your lease return ahead of the contract's expiration date. Expect to complete paperwork once you drop off your lease and for the bank to collect and inspect it afterward. Some banks require an inspection ahead of your lease's return. Bank Correspondence Prior to the end of your lease contract, you should receive mail that further explains the bank's lease-end procedure. Your bank will also offer you several lease-end options, such as returning...

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Should I Pay Off My Car Before I Sell It?

Regardless if you sell your car to a dealership or private buyer, the process involves a lot of paperwork. Almost all dealerships will take your car even if you owe on it, but you'll have to make payoff arrangements with either the buyer or lender if you plan to sell privately. While paying off your car can lessen the amount of paperwork and preparation, it's not always the smartest decision. Private Seller If you have a loan attached to your car, a lender holds the title. You cannot legally sell a car if you do not own the title. That...

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How to Buy a Motorcycle When the Owner Still Owes the Bank

Buying a previously owned motorcycle is similar to buying a previously owned vehicle. Just like a car or truck, a motorcycle must be titled in the state where it is registered. When the owner still owes the bank for the motorcycle, the title is usually held by the bank instead of the owner. This presents a challenge because the title must be transferred when the motorcycle is sold. Instructions 1 Ask the motorcycle owner to call the bank while...

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Would the Surrender of a New Car Affect My Credit?

Surrendering your vehicle, known as a voluntary repossession, affects your credit substantially. Also, if you have a co-signer, her credit is also affected. Before you decide to voluntarily return your new car, understand the financial consequences of doing so. Instead of surrendering the car, you may have other options available to you. Repossession Two types of repossession exist: involuntary and voluntary. If you return your vehicle willingly, your lender reports the return as a voluntary repossession to the credit bureaus. If the bank...

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The Best Car Loan Tips

Buying a new or used car often involves financing the purchase. The terms of your auto loan affect the monthly payment. Take steps to ensure you receive the best rate and terms on your next purchase by employing a few effective car loan tips. Improve Credit Auto lenders work with different types of buyers, and having a low credit score won't necessarily prevent an auto loan approval. However, bad credit does result in higher finance fees and a higher monthly payment. Getting the car that you want and a price you can afford may involve getting...

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How to Make a Down Payment on a Car

When purchasing a car, you have the option to buy the car outright, obtain financing from your bank or obtain financing at the dealership. A down payment is money paid upfront to a dealership and serves as a way to lessen the impact of a car loan by lowering your monthly payments. Because a down payment reduces the amount of money you need to borrow, your interest rate on a loan may be less than it would be if you didn't make a down payment. The down payment is made at the dealership. Instructions 1 Decide if you want to lease or finance...

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If My Car Was Repossessed, Can I Refinance Another Car?

Refinancing a car loan requires you to apply to a new lender to transfer your existing loan balance. Financing a loan allows you to start a new loan if you're a first-time car buyer or have paid off a previous loan. If your vehicle has been recently repossessed, pursuing either option is likely to prove difficult. Without a co-signer, expect to put money down and pay a higher interest rate. Finance Application To apply for a refinance or a new finance account, decide which lender to apply to. Because of your repossession history, it may...

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What Happens If You Try to Get Out of a Car Lease?

Leasing an automobile allows the freedom to use a vehicle and make payments on it, without having to purchase the car at full price. When the term of the lease is up, the lessee can choose to purchase the vehicle at a reduced rate, or trade the vehicle in for another lease agreement or car purchase. Leasing a vehicle, however, requires an individual to sign a contract, during which the person is required to continue making payments on the car. Lease Termination Getting out of a car lease can be difficult---but it is by no means impossible....

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How to Change a Lienholder

When you have a loan against your car, you may find it necessary to change the holder of your title at some point. The process of changing a lien holder will vary from one state to the next, but the general steps are the same. This may be necessary if you are refinancing your car or if the original title was incorrect in some way. Typically, you must pay a fee and fill out some paperwork. Instructions 1 Refinance your car loan. When you have a loan against your car, the lien holder will be the lender who currently holds your loan. When you...

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Home Equity Loan Vs. Auto Loan

Homeowners have loan options when they want to purchase a car. For example, they may acquire an auto loan or use a home equity loan. However, it's best to weigh the benefits and drawbacks of each one before deciding how to proceed. Significance A home equity loan is money that homeowners borrow based on the amount of equity in their home. Equity is the value of the home minus all liens, or loans, against it. These loans may be used for many...

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Financing & Credit Problems With Used Cars

Used cars are more economical than new vehicles because a brand-new car depreciates significantly as soon as you take possession. The average car value drops 15 to 20 percent within the first year, according to Bankrate.com writer Lucy Lazarony, and its worth continues decreasing. The cost savings makes used cars appealing if your finances are limited, but there are some challenges to getting a loan for a pre-owned auto, if you have past credit problems. Preparation Clean up your credit reports before applying for any loans. This will eliminate...

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Will Leasing a Car Improve My Credit Score?

Unlike a loan, a car lease allows you to use a car as your personal vehicle without having to purchase it. Because lease payments are typically cheaper than loan payments, leasing provides you with the ability to drive a car you may not be able to afford had you purchased it using traditional financing. Like an auto loan, however, a car lease appears on your credit report and influences your credit score. Credit Report Entry When you sign...

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Is Interest Paid on a Car Loan Tax Deductible?

Although you cannot deduct interest you pay on a car loan for a vehicle you drive entirely for personal use, you can deduct the interest as a business expense if you use the vehicle for business. The amount of deduction you are allowed to take depends on how often you use the vehicle for business reasons and how frequently you drive it for personal use. Business Use If you use a vehicle partially for business, but sometimes for personal use,...

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What Is the Rule of Thumb for Auto Depreciation?

Depreciation is the allocation of a long-term asset's cost over its useful life. Examples of long-term assets include buildings, computers, equipment and cars. The value at the end of a car's useful life is known as its residual value or salvage value. Car buyers should be aware of the effects of depreciation on new and used car values over time, especially when negotiating a fair price with a dealer. Facts Edmunds, an information company...

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Can a Car Dealership Refuse to Take Cash for a Vehicle Purchase?

A car dealership is within its rights to refuse to take cash for a vehicle purchase. Under federal law, businesses that price their merchandise or services in dollars have to accept dollars as payment. But accepting "dollars" doesn't necessarily mean accepting cash. Private entities are generally allowed to set their own rules on how they accept payment. Legal Tender Look on the face of any piece of U.S. paper money and you'll see the inscription,...

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What to Do When You Can No Longer Pay for a Car Title Loan?

Unlike regular car loans, car title loans do not provide financing for a vehicle but give a consumer cash to use for other purposes. However, a creditor who holds a title loan has the same rights as he would with a vehicle loan. If a consumer fails to make payments, a bank may seize the vehicle. The Legal Aspect When a consumer obtains a car title loan, he signs a contract which states that a creditor may repossess the collateral if a consumer...

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What Is a Good FICO Score for Buying a Car?

The Fair Isaac Corporation tabulates credit information on consumers and businesses across the United States and uses the data to award credit scores known as FICO scores. Financial institutions use FICO scores to assess the level of risk involved in writing loans for particular individuals or entities. Lenders have minimum FICO score requirements for all credit products including car loans. History In 1956, Bill Fair and Earl Isaac founded FICO. Initially the company recorded data for analysis that Fair and Isaac believed companies could...

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How to Buy a Car With Less Than Perfect Credit

A number of financing options exist for those in need of a new or used car provided you have good credit. Experian, one of three consumer credit reporting bureaus, says most credit scores fall between 600 and 750, with a lower score reflecting less than ideal credit. However, there are creditors willing to finance your car purchase under strict terms if your credit is not perfect. Assuming you cannot put off buying until your credit improves, carefully explore options for the loan that is right for you. Instructions Instructions 1 Determine...

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What Are Some Requirements to Obtain a Car Loan?

Because of subprime auto lenders, you don't need perfect credit to get a car loan. Still, you have to meet certain requirements to become eligible for an auto loan. Importance of Steady Employment Regular monthly income is necessary to qualify for an auto loan. Auto lenders vary, and you may need to provide several copies of paycheck stubs to qualify. If you have good credit, a lender may approve your auto loan application without verifying employment or income. Because paycheck stubs include your address, lenders can use this information...

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What Is the Difference Between Buying & Leasing an Automobile?

Purchasing a new vehicle requires a great many choices. The car buyer must decide on make, model, options and even the color of a new vehicle. The decisions require research and comparison -- shopping to find the automobile that best meets the buyer's needs. In addition to searching for the right car, the car shopper must determine the best financing option to acquire the car. The choice between a car loan and a lease depends on the individual buyer...

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Does a Car Dealership Have to Run Your Credit?

Depending on your financial situation, a car dealership may have to run your credit. In some instances the dealership may try to convince you that the Patriot Act requires to complete a credit application, which is not true. The salesperson may run your credit with just your drivers license without your permission. If you are worried about this, explicitly state that you do not want your credit run when you present your license. Leasing Leasing a car means that you agree to keep the car for a specified period and only drive up to a certain...

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How to Calculate Residual Values

An asset is only good for a certain period of time; that is, it only provides value or creates income for a certain time period before it is no longer useful. Residual value is the value of an asset after its useful life. As such, it is commonly used to determine depreciation expense for the income statement or liquidation value for larger transactions like bankruptcy. Instructions 1 Determine the scrap value of assets by contacting a junk...

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Cheapest Way to Buy a Car

Buying a car is one of the largest purchases you'll make, so it's always a good idea to try to pay as little as you can. Paying less for a car doesn't mean you need to sacrifice reliability; you can find plenty of bargains on good cars. There's no golden rule when buying a cheap car, but you can use a lot of different strategies when browsing for a new vehicle. Used Cars Buying used is almost always cheaper than buying new. Modern cars are...

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Operational Definition of Vehicle Financing

Most people do not pay cash for their vehicles. Instead, they borrow money to pay the dealership and then pay back the money in installments, usually paying each month. An understanding of this process, known as vehicle financing, can help most people who are interested in getting a new vehicle. Definition Financing is giving money to a person, company or agency. The purpose is to fund the purchase -- or in some cases, lease -- of an item...

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How to Request a Settlement Amount to Pay Off a Car

Paying off your auto loan can give you extra money to use every month, and it can also save you a substantial amount of money in interest payments. When the loan balance is low enough that you can pay it off, you need to learn the exact payoff amount. If you only pay the principal balance, it probably will be insufficient to pay off the loan because interest has been accruing. Knowing the settlement amount enables you to pay the amount needed to close the loan. Instructions 1 Contact the lender regarding the payoff amount for your car loan....

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How Can I Get Car Financing If I Have Absolutely No Credit?

Getting a car loan can be difficult when you have bad credit, but when you have absolutely no credit, it can be an even more trying process. If you have never used credit, it does not necessarily mean that you cannot get an auto loan if you need one. At this point, it may simply take a little more time to find what you need. Establish Credit If you need to get an auto loan, you may want to try to establish some credit first. If you can do so several months before you need the car loan, this would be best. You could open a checking account...

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How to Pay Back an Auto Loan With Interest

Many people borrow money to pay for a new or used car purchase. Taking a loan for the purchase is a convenient and efficient way to acquire a new vehicle if you do not have the money on hand to cover the purchase outright. Most, if not all car loans, however, require that you pay interest on the unpaid balance, computed as an annual percentage rate (APR). The APR for your loan should be clearly stated in your loan agreement. Most consumers pay their...

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Is it Better to Take Over a Lease or Get a New Lease?

An auto lease assumption may offer several money-saving benefits, such as a lower down payment, a cheaper monthly payment or a shorter term than a new lease. If assuming a lease, the original lessee has already provided a down payment and paid applicable lease fees, so you may not have to. Compare the price differences between a lease take-over and a new lease to determine which offers a more affordable option. Comparison Resources To compare the costs of new-car leasing and lease assumption, such as down payment requirements, mileage allowance,...

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How to Get a Second-Car Loan

Are you ready to buy a second car and need a loan? Qualifying for your second-car loan is similar to qualifying for your first-car loan. There are some important additional considerations, however, to take into account before you sign on the dotted line: Do you make enough money? Should you use the same lender? How much car can you afford? These are all common questions with relatively easy answers if you tap into the appropriate resources. Instructions 1 Calculate your debt-to-income ratio. This ratio tells lenders how much extra money,...

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What Do Banks Look for in Car Loans?

Banks look at various pieces of personal, credit and vehicle information to determine whether to extend a loan. Then, according to the information it gathers, a bank sets a loan interest rate and term. You may also find that you are required to provide a down payment or may face term restrictions if your application is approved. Credit History To apply for a loan, you must provide your potential lender with your Social Security or Tax Identification number, which allows the lender to view your past credit history. Your credit report lists...

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The Average Depreciation of a Vehicle

Buying a new vehicle has its advantages, from a full manufacturer warranty to the peace of mind that comes from knowing that you're the first owner and no one else has abused or neglected your car in the past. But new cars also have a strong tendency to depreciate, or lose value, rapidly. Why Cars Depreciate Unlike other large purchases, such as homes, cars generally lose value consistently for the length of time they're on the road. In part,...

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