Legal Question in Credit and Debt Law in Maryland
How can I avoid a car repossession when my car is a lemon?
I leased a car five years ago and my transmission, axle, and other things went wrong, I could not afford to buy a new car, so at the end of my lease, with stupidity I purchased the same car. However those things were covered under a warrenty when I leased/purchased the car. I have been having trouble making car payments on the car. I was highly affected by the September 11 trajedy. I was laid off of my job and had to rely on my second job to make ends meet. I can barely afford to pay for the costly repairs such as the front suspension collapse; the exhaust system has failed and again the axle had to be replaced and the transmission had to worked on again, and in my line of work I am in desperate need of a vehicle. I am a delivery driver I uses my own vehicle to earn money from. These repairs has cost me a great deal of money which I am unable to come up with the money to keep up with my payments. so in other words the company has threatened to reposses the car which I would have no problem returning the car to them accept for one thing, the car is a lemon and in the court of law if I prove that the car is a lemon I do not want to be liable for any payoff balance owed on the car please help.
1 Answer from Attorneys
Re: How can I avoid a car repossession when my car is a lemon?
It is not clear whether the subject vehicle is indeed a lemon.
You indicate using the vehicle for delivery, the newspaper I suspect, and that
you had done so for five years or more. The mileage on the vehicle is probably high
and the wear and tear you describe sounds consistent with heavy use. Even if you prove that the
vehicle is a lemon, this does not entitle you to revoke your obligation under the note. The seller
has the option to cancel the debt but also has the option to make good on the sale.
As for repossession, the value of the car upon sale is not likely to be great. Any proceeds would be applied to your loan
balance and your would remain liable to repay any remaining balance (a surplus, if any, is required by law to be returned to you). In some circumstances, a creditor may work with you and an accord and satisfaction could be a remote possibility.
Also be aware that the costs of repossessing the vehicle and disposing of it at auction are usually charged against the debtor so you would be liable for these costs as well.
Loosing through car to repossession may be costly. If it appears that you simply cannot make the payments then contact the creditor and open a dialogue as to your options.
Sometimes a creditor is willing to accept payments of interest only but this is usually for a short time period. If you think you will be defaulting on the loan, you should discuss
this with the creditor as well and be sure to find out about ways to minimize the costs associated with forfeiture such as where you can deliver the vehicle, etc.
Good Luck and I Hope You Business Improves
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