Overhaulin'

Whats the process of a car lien sale?

So say that you dont have any interest in your car anymore after It was towed for 30 days but your still paying the finance company, what happens after you sign the lien transfer sheet over to the towing company? How does it hurt your credit and is the car sold at the auction way under value? If so, what is the process for paying the unpaid balance and if paid, will it still hurt my credit? I know its confusing, im sorry..

Public Comments

1. The car was only collateral to the Note that you signed. If the sale of the car at auction did not satisfy the Note balance, then the finance company will sue for the deficiency. As for your credit, the damage is already done in that the car was reposessed (taken back for non-payment). You won't be able to get a loan again anytime in the near future. You should have sold the car instead of let it be taken back.
2. so...... after you signed off on the lien the tow company has the right to sell the car at auction to recoup the money due to them for storage and towing. This still leaves money due to the finance company that financed the car for you. Since the car was "signed off" and they can repo it from you but the balance is still due, most likely they will file small claims against you to collect on the unpaid balance. Most likely the next step for them is to charge off the loan and send it to collections. They will file Small Claims against you and seek a Judgment. After they receive a Judgment against you they can file a garnishment against you for wage income and or income tax return. If I were you I would try to make arrangements to make payments to the finance company and try to keep it off your credit. It will be reported to your credit after 30 days if a payment is not made. I hope this helps, and sorry about your situation!
3. As I aways say to my customer's we loaned you the money not the car. Sometimes cars are sold under value sometimes not. It depends on what the buyers are willing to pay and what they think they can get out your car by reselling it. If the car is sold for less then what you owe the towing company then can come after you for the remaining balance. As far as your finance company is concerned they may not sue you as long as you keep the payments currant but if you default they will come after you. I would advise you to contact them and set up arrangements for the repayment of the debt. Please don't be fooled into thinking that they cannot do anything to you. There are lots of things that the finance company do you even to stop or interfere with you purchasing a home at a later time.
4. Be careful. A towing company can ruin your life for a bunch of years. You have been given good advice by others.