Car Repossession Law in TN

The Basics of TN Car Repo Laws for Memphis and Beyond

As a Memphis bankruptcy lawyer, I get a ton of questions about car repossession law in TN. The laws vary by state, so it’s important you know your rights for your area.

If you’re worried about repossession and want to understand it, here are some of the basics you need to know.

Getting Caught Up on Payments: The Right to Cure

In Tennessee, the law allows you something called a “right to cure.” This is a chance to catch up on your missed payments before a repossession.

Once you default on your auto loan, the lender is required to send you a notice that outlines your missed payments and provides a window of time to remedy the situation. This period typically ranges from 10-20 days. It gives you an opportunity to get current and avoid repossession.

That said, most of the people who contact our office can’t just magically find the money in a couple of weeks. In addition, without dealing with the underlying problem, you may end up in the same situation a few months later.

If you need a longer-term solution, bankruptcy offers a legal path to stop repossession for good.

Repossession Process

If you fail to get caught up within the specified period, the lender can proceed with repossession. To do this, they have to follow a strict legal process.

Under Tennessee law, lenders don’t have to get a court order or notify you when repossessing your vehicle. They have the right to repossess your car at any time if you’re behind on payments. This is different from some other states and can catch people by surprise.

However, repossession agents can’t breach the peace during the process. That means they have limitations and can’t do certain things, including:

• use physical violence
• threaten you with assault or weapons
• enter or break into enclosed property
• force you out of your car
• etc.

So for example, as part of these rules, agents can’t enter a locked garage without permission.

Any violation of these rules could give you the right to take legal actions against the lender. If you have any questions about these rules or want more info, get your copy of our free report Creditors Can’t Do That.

 

Notice of Sale

After repossession, the lender has to provide you with a notice of sale.

This notice details their intent to sell the repossessed vehicle. They have to include the date and location of the sale. It serves as a final opportunity for you to reclaim the vehicle by paying the outstanding debt.

Bear in mind, at this point the lender will likely have added repossession and storage fees. So your debt might be higher at this point than it was before.

Deficiency Judgments

In Tennessee, the sale has to cover the loan principal, interest, and repossession fees. If the sale of your repossessed vehicle doesn’t cover your outstanding loan balance, the lender might pursue a deficiency judgment against you.

This means you could be held responsible for the remaining balance after the sale.

Deficiency judgments can mean an additional financial burden when you least expect it. It can be infuriating to lose so much through repossession and then still owe more. It’s one of the reasons bankruptcy can be so helpful – you can get out of debt without losing your car or facing surprise debts in the future.

Bankruptcy and Repossession

Fortunately, you do have options to stop car repossession. First, you can always try to work with the car lending company. Sometimes (although rarely), they’ll offer a payment plan or help you get back on track.

However, when this option fails, you may want to consider bankruptcy. Chapter 13 can stop repossession altogether and help you get out of debt permanently. Unlike other debt payment programs, it has the power of federal and state law behind it. So the creditors can’t go back on their word or take your car out from under you.

We outline how bankruptcy stops repossession in our free report Don’t Let Them Take Your Stuff.

Getting Legal Help with Car Repossession Law in TN

If you need to stop a repossession, you should choose a lawyer who understands car repossession law in TN. They should have a reputation for client satisfaction and success.

Our award-winning team has helped thousands of people in Memphis stop repossession and get out of debt. We stand by your side every step of the way and never charge extra for phone calls, questions, and additional support. You know what you’ll get with us – a thorough, caring team who have your best interest at heart in everything we do.

That’s how we’ve earned multiple Martindale-Hubbell awards for client satisfaction, an A+ from the Better Business Bureau, and a 5-star rating on Avvo.

You don’t need to spend your life looking over your shoulder, worried you could lose your car. It’s possible to stop repossession today – and we can help.

We offer a totally free consultation to answer your questions, no strings attached. To get started, call us today at 901-327-2100 or contact us online.

We look forward to talking with you!

Frequently Asked Questions About Car Repossession

If you are facing car repossession, you can turn to our team who has helped many in Memphis stop car repossession. Car repossession can be an overwhelming experience, especially when you’re unsure of your rights or the legal process. If you’re facing the possibility of repossession, it’s natural to have questions about how it works and what you can do to address the situation.  We offer 24/7 call answering.

What Is Car Repossession, And How Does It Work?

Car repossession happens when a lender takes back a vehicle after the borrower falls behind on payments. In most cases, if you miss a payment or two, your lender has the right to repossess the car without warning. Usually, repossession companies are hired by the lender to retrieve the vehicle. Once the car is repossessed, lenders will typically sell it at auction to recover the remaining loan balance. If the car is sold for less than the loan balance, you may still owe the difference, called a “deficiency balance.” However, laws vary by state, so it’s worth checking with a legal professional to understand your specific rights.

Can I Get My Car Back After It Has Been Repossessed?

When you need to stop car repossession in Memphis, It is possible to recover your car after repossession, but the options depend on your lender and the terms of your loan agreement. Some lenders allow borrowers to “reinstate” the loan by paying past-due amounts and fees to regain possession of the vehicle. Others may offer the chance to “redeem” the car by paying the entire remaining loan balance, plus any fees. In certain cases, a repayment plan may be an option, though this is not always available. Speaking with your lender as soon as possible can help you understand what’s feasible for your situation.

Will Car Repossession Affect My Credit Score?

Unfortunately, yes, car repossession can significantly impact your credit score. When a lender reports missed payments, your score may drop, and the repossession itself can remain on your credit report for up to seven years. This negative mark may affect your ability to secure future loans, and you may be seen as a higher risk by other lenders. While it can take time, improving your credit after a repossession is possible by maintaining a positive payment history with other accounts and gradually rebuilding your creditworthiness.

Can A Lender Repossess My Car If It’s Parked In My Garage?

Yes, but with some restrictions. Although lenders can generally repossess a vehicle without notice if payments are missed, they must follow certain rules. In most states, repossession agents are not allowed to “breach the peace” during the process, which includes entering a locked garage or other private property without permission. If your car is parked on public property or in an open driveway, however, repossession agents can usually proceed without violating any laws. If you’re concerned about your rights or the legality of a repossession, it’s a good idea to consult with an attorney to better understand your options.

Are There Ways To Stop Or Avoid Car Repossession?

Yes, there are steps you can take to try to prevent repossession. If you’re struggling to make payments, reach out to your lender right away. Many lenders offer hardship programs or temporary payment arrangements that might help you stay on track. Loan refinancing may also be an option if your credit and financial situation allow it. Finally, filing for bankruptcy is another possible way to halt repossession and potentially reorganize your debts, though this is a major step and should be considered carefully. The Better Business Bureau has given us an A+ rating and we are here to help. Speak with our team at Darrell Castle & Associates to stop car repossession in Memphis today.