Legal Question in Credit and Debt Law in Virginia

Re: Reposessions

Although you should get notice (again, at your last known address, not necessarily where you do live) your only real defense is to pay any balances due. That is the purpose of the notice to give you a chance to bring the loan current. Depending on the wording of the contract, they may try to, and may be able to, demand the entire balance of the loan in total.

There is one other thing you can do which is legally correct, but most judges are too unfamiliar with it to enforce these rights. But you should give it a try.

If you can sell the car (or whatever) at a decent price, but the lender refuses to cooperate, then the lender can only collect any deficiency based upon the sale price you could have gotten. In other words, if the lender later sells the car for LESS than what you could have sold it for, they are limited in what they can collect as a deficiency to the higher sale price.

This defense is called "mitigation of damages."

You would want to send a letter, certified mail, saying that you have found a buyer for $X and request their cooperation (if necessary) in completing this sale. Then if they sell it for less than $X, they must eat the difference, not you.

That is the law. However, it is not something that is commonly used, so far too many judges may be too slow to enforce this defense.

Re: Reposessions

In answer to your question the consumer should look to the contract which he executed with the creditor to determine what notice rights he may have prior to the creditor taking action to repossess whatever is the subject of the delinquency. As a practical matter, virtually all creditors will normally send out to the creditor's last known address notice of a delinquency before taking any enforcement action.

(If the creditor has moved and does not actually receive the notice, this is not a defense to any

subsequent action which the creditor might take to enforce the delinquent loan.)

Re: Reposessions

Correction. The parenthetical last sentence should read: If the credit recipient...rather than the creditor.