Legal Question in Credit and Debt Law in Washington

Re: Collecting balance on repossed car.

When a car is repossessed by a creditor, the creditor will usually resell the car at an auction. The amount received from the auction is then subtracted from the amount still owing on the car loan. The amount remaining, if any, is called a deficiency. The creditor can now hold the debtor liable for the remaining balance or the deficiency. What a person in your position will want to do is to request a payment statement from the loan company or creditor which will show what the amount owing on the loan was at the time the car was repossessed. Then you will want to compare this amount with the amount the creditor says was owing at the time of the auction to see if the creditor is mis-stating the actual amount owed. Keep in mind that the creditor is allowed to add a few misc charges such as towing or the repossession fee as long as they are allowed by agreement or statute.