Can a creditor take my car?

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Latest post 01-25-2012 4:26 PM by Kivi. 13 replies.
  • 01-25-2012 12:58 PM

    Can a creditor take my car?

    Capital One sued me for unsecured credit card debt of about $4000. 

    I am worried they will take my car after getting a judgement. 

    After some searching, I found this but don't quite understand it... http://www.courts.ca.gov/documents/exemptions.pdf

    Does it mean I have to file ch 7 bankruptcy to get protection or don't have to and still get protection?

    My car is worth only about $2000 according to KBB trade-in but $3000 according to Private sale. So which do they go by?

     

  • 01-25-2012 1:11 PM In reply to

    Re: Can a creditor take my car?

    And if they can and do go after my car..... how long does it take to obtain the court order? can it possibly take months or is it sooner?

    I want to transfer the title of the car to family if they do go after it. 

  • 01-25-2012 1:15 PM In reply to

    Re: Can a creditor take my car?

    Steve Comp:
    I want to transfer the title of the car to family if they do go after it.

     

    Be aware that courts can "un-do" your transfer if it decides it was done for fraudulent reasons to avoid legit bills.

    It's more likely that your salary will be garnished, if you have one.  If not, they may go after your car.  But don't do anything foolish that will get you in more trouble.  If you owe them, you owe them.

  • 01-25-2012 1:32 PM In reply to

    Re: Can a creditor take my car?

    It's highly unlikely that the creditor would go after your car.

    You wouldn't have to file bankruptcy to get the exemption. If the creditor gets a judgment and files a writ to attach your car you would just have to file a response claiming the exemption.

    With a value of $2000 to $3000 and an exemption of $2725 the creditor would have to sell your car and give you the $2725 first before getting any money if it sells for more than the $2725.

    Chances are that it would sell for a lot less than the exemption because the creditor would most likely put the car in to a wholesale auction where it's likely to sell for closer to the trade in value or even less.

    Credit card companies are more likey to garnish your pay or levy your bank account, or both at the same time, which could really hurt. So your best precaution is to get your money out of the bank so there's no cash for them to grab. Put a stop to any automatic deposits and just have checks given or sent to you and find another way to cash them and pay your bills by money order. At least that will limit your exposure to just part of your paycheck.

     

    • The right of the people 
    • to keep and bear arms,
    • shall not be infringed.
  • 01-25-2012 2:14 PM In reply to

    Re: Can a creditor take my car?

    So if I understand correctly....

    They won't take my car because there's nothing in it for them. Even if they sell it for $2825, they can only keep $100 and must return the $2725 to me?

    But what if they take it just to screw me over? Let's say they sell it for just $700 at auction.... do they have to pay out of pocket to make up for its real value or hand me just the $700 and wash their hands of it. Then I'd be left with no car and just $700 which couldn't buy a decent running car.  

     

    Anyone know how long it takes them to get permission to take my car? Does it take months or is it done on the same court date (which they haven't told me yet).

     

     

     

  • 01-25-2012 2:22 PM In reply to

    Re: Can a creditor take my car?

    Can someone tell me the difference between EXEMPTIONS UNDER SECTION 704.010 et seq and EXEMPTIONS UNDER SECTION 703.140(b)?

     

    http://www.courts.ca.gov/documents/exemptions.pdf

     

    The first says vehicles are exempt up to $2725. Second says $3525?

     

  • 01-25-2012 2:24 PM In reply to

    Re: Can a creditor take my car?

    They are not likely to take your car as it is too much trouble for too little $.  Do you have a job?   Garnishment is the usual way.

    You are so worried about the car, yet not garnishment?  Makes me think you may not have a salary to garnish?  If so, that would probably be the only situation where they MIGHT bother with your car.  Even  then, it may be too much trouble and they just wait until you do get a job they can garnish.

    You might want to look into BK if this has ruined your credit anyway.  But it may not be worth it for $4000, considering the effect on your credit rating and future attempts to get credit.

     

  • 01-25-2012 2:33 PM In reply to

    Re: Can a creditor take my car?

    I am not worried about garnishment cause I am unemployed at the moment. But I guess I will be once I find one. How long does garnishment stay with you? forever until paid?

    I need my car to look for work and stuff since there's no public transportation here (very rural) so it's important to me. 

  • 01-25-2012 2:36 PM In reply to

    • Kivi
      Consumer
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    • Joined on 01-01-2005
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    Re: Can a creditor take my car?

    1 Yep. Please note that there also are lots of costs to seizing a car, so Capt One won't do it just to get $100. Their costs likely would exceed that amount.

    2. The creditor in question is a large corporation. While it does aggressively pursue their collection accounts because its origen is from the subprime world, It won't take your car just to "screw you over". Iif the process of seizing your car is not really going to be cost effective then it is not likely to happen. . Also, if you still have an outstanding loan on your car, the car lender would get paid first as that creditor is a secured creditor. Then, there is your exemption and only if there is any money left over would the unsecured creditor get paid. Being third in line on an older vehicle does not llok too promising to me. Most people are pretty underwater on their car loans to begin with. This creditor wants money . An employee who sought and executed a writ execution on a car worth $2000 only to see that money returned to the debtor because of a state exemption probably would soon become an ex-employee. He has cost the company money not collected any money on a debt.

    Generally these writs of execution are used by individuals, such as landlords who are owed money for unpaid rent or eviction costs and individuals like that. With this particular creditor, the decision to seek a writ of execution will strictly be a business decision. In other words, is going this route likely to generate enough in the way of a recovery to justify the costs. Even though the creditor might get to add these costs to your debt, there is still the issue of collecting on it. Unless your car has some unusual value, it is not likely to happen with this particular creditor.

    Some states may allow a creditor to put a lien on your car title. You would have to resolve the lien if you ever wanted to sell the car. I don't know about your state, but the process of putting a lien on your car title, if it is an option, likely would be far easier than going for a writ of execution, hiring someone to get your car, hauling it off,  and then arranging for the auction. Of course, if you just intend to drive the car until it falls apart, then you may not particularly care if the title has a lien on it.

  • 01-25-2012 2:57 PM In reply to

    • Drew
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    • Joined on 03-30-2000
    • PA
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    Re: Can a creditor take my car?

    One old local judge suggested I think like person at other end--the car may not be worth much to me as a creditor and may be a pain to chase--but to some folks their wheels are disproportionately treasured and it may make sense to grab your wheels --sure to get your attention! 



  • 01-25-2012 3:22 PM In reply to

    • Kivi
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    • Joined on 01-01-2005
    • CA
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    Re: Can a creditor take my car?

    Drew, you were a landlord, not a mega corp.

    An employee in a collections department likely would have to justify a writ of execution to his management, if for no other reason than the corp's legal department probably has to prepare it. (Think about highly compensated attorneys.) . For an older vehicle, especially if it also is encumbered with a loan and an exemption that is almost as much as what the vehicle is worth, I don't see it happening, even at CAPT ONE.

    With large corporations, these kinds of decisions tend to be very impersonal.  The chances are good that the collections employee has some kind of written guidance about when to consider a writ of execution based upon what is known about the debtor's assets and income.

    Also, many of these collectors work on commission. Taking an action that would result in little or no commission for the collector is not going to be very appealing.

  • 01-25-2012 3:53 PM In reply to

    • Drew
      Consumer
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    • Joined on 03-30-2000
    • PA
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    Re: Can a creditor take my car?

    True--not worth a commision collectors time at all to go grab cars but they sure might try to rattle his cage with tall tales just to see if anything shakes loose--after all they may not know unable to pay he is--or may claim to be.  And frankly  even at my level to grab something was rarely productive on bottom line. Then again in my state its impossible to get a wage execution except for child support.



  • 01-25-2012 3:59 PM In reply to

    Re: Can a creditor take my car?

    I understand that it's not worth their time to go after my car.... BUT let's say they do.

    And it sells for $700 at auction...... so I would get the $700 but be out $2000, correct?

     

  • 01-25-2012 4:26 PM In reply to

    • Kivi
      Consumer
    • Top 25 Contributor
    • Joined on 01-01-2005
    • CA
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    Re: Can a creditor take my car?

    In theory that could happen. No one can say it will not happen.

    However, if some collector is threatening to take your car, just nicely point out that it is an older vehicle with 120,000 miles on it. (You should accurately describe the make and model and year as that info is easily verified, but it's unlikely the collector will order a Carfax just to verify your mileage claim.) Then point out that your state's exemptions would give you the first $2000 (or whatever it is) and that he or she can do the math as to how much money Capt One would actually get from taking such an action and how much of a commission he or she would actually get. You also can mention that you currently are unemployed, so there is no wage to garnish at this time.

    Don't get angry or argumentative. Just point out the facts and let them speak for themselves. This collector probably has many debtors to chase after. Let him or her believe that other accounts may be more promising than yours.  

    If Capt One does get a judgment against you, you may well be hauled into court for a debtor's exam wherein you would be asked about your income and assets. I actually think that would much more likely to happen than your car getting seized.

    Your other option, of course, is to file for bankruptcy protection. I personally would not want to invoke BK if this in the only debt you have because you can only file for a chapter 7 BK once every eight years. But, if you have other creditors yapping at your heels, then maybe it is time to review this option.

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