Car Loans and Repossessions –
Read this Before Making a Purchase

AIDS Legal Services Project

Car Loans

Los Angeles is known for its car culture, and if you are used to having a car or otherwise having a hard time getting around, it is easy to get sucked into buying your own auto. Just remember, other than buying a house or condo, purchasing a car may be the most expensive item you ever buy. BEFORE YOU DO, consider if it is something you can truly afford especially when you factor in the cost of car insurance which is required in California. This means monthly payments that can easily top $350, plus of course, gas and the cost of repairs and upkeep.

If you fail to make even one payment or otherwise breach your loan contract (like letting your car insurance lapse), the lender can have your car repossessed without any notice to you or a court order. AFTER the car is repossessed, which can happen in any public area, including a parking lot or in front of your house, only then is the lender required to provide you with legal notices. But you must act quickly to get your car back.

Deficiencies in a Car Repo
If you decide you can’t afford the car and just let the lender keep it, they will turn around and resell the car at an auction and most likely at a loss (which means they sell it for less money than what you owed), and will send you a bill for the difference. This is called a deficiency and it is still a financial problem for you since you are liable for their loss.

For more information visit:
Los Angeles County Consumer & Business Affairs - Vehicle Repossessions
Department of Consumer Affairs - Consumer Guide to Vehicle Repossession


Disclaimer- The content here on this website is informational only and is not an exhaustive review of consumer debt issues nor is it intended to be legal advice. The intent is to provide you with general information to better understand your situation and the tools available to take action if needed. This website contains links to other third-party websites. Such links are only for your convenience; we do not recommend or endorse the contents of the third-party sites. You should contact an attorney to obtain advice with respect to your particular legal matter. Use of, and access to, this website or any of the links or resources contained within the site do not create an attorney-client relationship between you and LACBA Counsel for Justice, its employees or volunteers.

THE CONTENT FOUND HERE WAS CURRENT AT THE TIME OF WRITING (MAY 2020). LAWS AND LEGAL PROCEDURES ARE SUBJECT TO FREQUENT CHANGE AND DIFFERING INTERPRETATIONS. YOU SHOULD SEEK THE COUNSEL OF AN ATTORNEY TO RECEIVE LEGAL ADVICE SPECIFIC TO YOUR SITUATION.