Repossessions and Errant Stolen Car Reports

When a car is repossessed, owners often mistakenly think that the car was stolen and file an errant stolen car report. This can cause big problems later down the line when the repossessed car is resold and the new owner is driving a vehicle that is still tagged as “stolen” in the Law Enforcement Agencies Data System (LEADS). This is exactly what happened recently to a woman in East Peoria, reports the Journal Star. The woman purchased a used Ford Edge from a dealership and was issued a new title on March 24th. Then, just six days later on March 30th the woman was pulled over for speeding. The officer ran a routine LEADS check and informed the woman that the car had been reported stolen. The car was towed by the police for further investigation and the surprised woman was left to find her own ride home. Eventually the police determined that the car’s original owners had mistakenly reported the vehicle as stolen when the car was repossessed and that the tow was not reported to the Chicago Police Department as it legally should have been.

Mistakenly believing that your repossessed car was stolen can cause a great deal of stress, but fortunately there are proactive steps that you can take in order to avoid being blindsided by a repossession. The first step is to try to get your finances in order so that repossession can be avoided in the first place. If you are unable to do so, then step two is to consider an alternative to repossession such as bankruptcy. An experienced repossession lawyer can help you with both of these steps.

Arranging Your Finances in Order to Avoid Repossession

It may sound obvious, but in order to avoid having your car repossessed it is essential that you keep up with your payments. If you fall behind with even one payment a secured creditor technically has the authority to repossess your vehicle. With that said, most creditors would typically rather have you continue to repay your debt rather than repossess your car. If you are unable to make your payments on time it is sometimes in your best interest to reach out to the creditor and negotiate a new payment plan. In these situations the debtor will likely have to pay increased costs, such as a higher interest rate, but under the new plan you will hopefully be able to keep up with your payments and avoid repossession.

Chapter 13 Bankruptcy: An Alternative to Repossession

If you are simply unable to make your monthly payments, you may want to consider filing for Chapter 13 bankruptcy protection. Chapter 13 bankruptcy acts as an alternative to repossession because as soon as you file your petition for protection seizure of your possessions is automatically halted. Be careful though; there is a big difference between filing for bankruptcy under Chapter 13 versus Chapter 7. A Chapter 13 bankruptcy restructures your debt so that you are able to continue making car payments and therefore enables you to keep possession of your car. On the other hand, a Chapter 7 bankruptcy liquidates a debtor’s assets in order to pay off creditors. Therefore, if you file for bankruptcy under Chapter 7 your vehicle will likely be sold. However, if it is very important that you keep a particular possession, such as your car, a skilled repossession lawyer may be able to convince the court to allow it.

Need Legal Advice?

If creditors are threatening to repossess your car or other belongings, contact the Bentz Holguin Law Firm, LLC to set up a free consultation to discuss stopping your repossession. Our experienced Chicago repossession lawyers can answer any questions that you may have about Illinois’ repossession laws and are happy to discuss your legal options with you. The Chicago office of the Bentz Holguin Law Firm, LLC can be reached at 312-647-2116.