If your auto lender repossessed your car in Pennsylvania, you might think your financial obligation ends there, but that’s not always the case. One question we sometimes get is, “Can you be sued for a repossessed car?” The answer is yes, depending on your specific situation.
When you fall behind on car payments or break the terms of your loan agreement, the lender may take back the vehicle. But even after vehicle repossession, you could still owe the lender money under Pennsylvania state law.
At Sadek Bankruptcy Law Offices, our team has helped many clients facing legal action over auto loans, including car repossession and deficiency balance lawsuits. If you’re worried about getting sued after a repossession, speak with a knowledgeable Pennsylvania car repossession lawyer on our team today.
Call us in Pennsylvania at (215) 545-0008 or in New Jersey at (856) 890-9003 to discuss your options.
Pennsylvania Car Repossession Laws
Vehicle repossession laws in Pennsylvania give lenders the right to take back a car without warning if a borrower violates the loan agreement. This can happen if the borrower misses payments on the car loan or violates other terms of the loan.
After your lender repossesses the car, they typically sell it at auction in order to pay off the outstanding debt, the cost of repossession, the cost of selling the car, fees from late payments, and more. After the lender sells the car, you’d hope that would be the end of the story, but that’s not always the case.
What is a Deficiency Balance?
If the lender sells your car, but the sale does not cover the balance owed, the remainder is called a deficiency balance. You, the borrower, are responsible for the deficiency balance. After the sale of the car, the lender has 30 days to notify you of the sale price of the vehicle, the itemized costs of the repossession and auction, and any deficiency owed on the debt.
What Happens To the Debt When a Car is Repossessed?
After a lender repossesses your car, they typically sell it at a private sale or public auction in order to pay off your original debt. However, if this sale doesn’t cover the debt, as well as the repossession costs, the lender may hold you responsible for that remaining deficiency.
What Happens if You Don’t Pay Deficiency Balance?
If you don’t pay the deficiency balance, the lender can then request a deficiency judgment from the court and file it against you. This is a court order requiring you to pay the remaining past-due amount on the loan, along with the cost of the repossession and any late fees and interest specified in the original loan terms.
Can You Be Sued for Car Loan Debt After Repossession?
Yes, if a lender repossesses your car and the resale doesn’t cover the full amount owed, they can still take legal action against you. While Pennsylvania wage garnishment laws protect you from wage garnishment in these situations, you may still face other collection efforts, like levies or liens. If you’re facing a lawsuit after a repossession, it’s important to understand your rights and explore your options with a Pennsylvania repossession lawyer before things escalate.
Statute of Limitations on Car Repossession Debt
In Pennsylvania, lenders have four years from the date of your last payment to file a lawsuit against you. If the lender waits longer than four years to collect the remaining debt after repossession, they lose the right to take you to court.
However, if they do sue within that time and you don’t respond, the court may issue a default judgment against you. It’s important to understand your rights because once the statute of limitations passes, creditors can no longer legally force you to pay.
What to Do if Sued for Car Loan Debt After Vehicle Repossession
If a lender has sued you after taking your vehicle, it’s important to contact an attorney right away. The team at Sadek Bankruptcy Law Offices can help you understand your legal options and fight back against the judgment. Unpaid debt and legal judgments can harm your credit and follow you for years, so obtaining legal advice from a lawyer is crucial.
How a Pennsylvania Car Repossession Lawyer Can Help
While it may seem daunting to face a lawsuit after car repossession, you don’t have to face it alone. But how can a Pennsylvania car repossession lawyer help in this situation? At Sadek Bankruptcy Law Offices, our legal team can review your original contract, explain your rights under state law, and determine whether the lender followed proper procedures when they repossessed your car and sold it at auction.
In many cases, the lender may not be entitled to the full amount they’re trying to recover, or they may have violated the terms of your loan or Pennsylvania law. Additionally, a Pennsylvania repossession attorney on our team may be able to negotiate a settlement or assist with early termination of the loan to help you save money and reduce the damage to your credit.
When all else fails, a lawyer on our team can help you declare bankruptcy, which would immediately halt the judgment against you. We can help determine which chapter of bankruptcy works best for you and guide you through the bankruptcy process, putting you on the path to financial recovery.
Stop Creditor Harassment on Auto Loans
If a lender repossesses your car, you might still owe the difference between what the vehicle sells for and your remaining loan balance, along with added costs and fees. This can lead to nonstop collection calls and legal threats. Filing for bankruptcy, such as Chapter 7 bankruptcy, can put an immediate stop to this harassment.
It triggers an automatic stay that prevents lenders from trying to collect on the debt or sue you for the remainder. A qualified attorney can explain how this affects your remaining payment obligations and how it may protect your credit from further damage.
File for Bankruptcy to Prevent or Reverse Repossession
If you’re a borrower in Pennsylvania facing car repossession, Chapter 13 bankruptcy in Pennsylvania may help you keep your vehicle. This type of bankruptcy allows you to catch up on missed payments over time while protecting your property from seizure. A bankruptcy attorney can help you work out a manageable repayment plan with your lender, covering what you owe without additional penalties or interest. Filing for Chapter 13 may also reduce long-term damage to your credit and prevent further fees from piling up.
Defend You in a Lawsuit
If a lender has sued you after car repossession, the attorneys at Sadek Bankruptcy Law Offices can help defend you and your rights. An attorney at Sadek Bankruptcy Law Offices can defend you in a lawsuit over a car loan, helping you dispute what you may owe and taking steps to protect your credit throughout the process.
Need a Lawyer for Car Repossession in Pennsylvania? Call Sadek Bankruptcy Law Offices Today
It can be difficult when a lender comes to take your vehicle, or even your personal property within your vehicle. A lender suing you after all that can add insult to injury. However, if you’ve had your car repossessed and you’re facing a lawsuit, you don’t have to fight this alone. Call a Pennsylvania bankruptcy attorney at Sadek Bankruptcy Law Offices today.
Our lawyers are here to help those who have been sued for repossessed vehicles, as well as those facing repossession. Call our Pennsylvania number at (215) 545-0008, or our New Jersey phone number at (856) 890-9003 today. You can also contact us online to schedule a free consultation with an attorney on our team.