Consumers who fail to make timely payments on their cars or maintain insurance on their financed vehicles may face repossession by their finance company. Under most vehicle finance contracts, the finance company has the right to take possession of the vehicle without a court order and auction the vehicle to repay the underlying loan. Recent statistic show that 1.7 million people faced this situation in 2018, with numbers expected to top 2 million cars within the next decade.

How Companies and Agents May Illegally Repossess Vehicles

car repossessionWhile finance companies have the right to retake vehicles if the consumer fails to pay, they must still obey the law and they may not breach the peace. Broadly, this means that finance companies and their agents can take your car if you do not pay for it. But they may not engage conduct that is likely to cause a disturbance or violence. The following are the most common ways that we see finance companies and repossession agents break the law when repossessing cars. These tactics will also convert what is otherwise a perfectly legal repossession into an illegal one, opening the door to a remedy for the consumer.

Repossessing Despite the Consumer’s Objection

While finance companies and their repossession agents have the right to retake a vehicle if the consumer defaults, they may not repossess the vehicle if the consumer objects at the time of the repossession. There are no magic words required here. Any words that indicate the consumer’s objection to the repossession are sufficient. And if the consumer does object, the repossession agent must stop and try again at a different time. If the repossession agent refuses to honor this objection and continues with the repossession, he does so without any protection from the law.

Breaking into a Locked Yard or Garage

Most finance agreements provide that the finance company can come onto your property to take the vehicle if you default on your loan. Even if your contact has a provision like this, this right does not allow finance companies or their agency to break into locked yards or garages. Likewise, the right to take possession of a vehicle in default to give finance companies the right to destroy unrelated property like fences, locks, or doors. By breaking into a closed garage or yard the repo agent may be committing the crime of criminal trespass or breaking and entering, both of which can be serious. So if a repossession agent wants to access a locked area, they must secure the consumer’s permission or else risk violating the law and committing a breach of peace.

Repossessing an Occupied Car

Traffic laws prohibit passengers on towed vehicles, so you would think that no company would repossess an occupied vehicle. Even so, repo agent who continue to be frustrated in their efforts have resorted to this practice, hooking up and hoisting occupied vehicles. In most instances, this practice violates more than the motor vehicle code. Intentionally causing contact with an occupied vehicle can be battery and moving an occupied vehicle may constitute a kidnapping. Both of these are serious crimes and constitute a breach of peace that can turn a lawful repossession into an illegal one.

Threat or Use of Violence

Most repossession companies will attempt to take a vehicle when no one is present — while the consumer is asleep, at work, or shopping. In some instances though, the repossession agent does not want to wait for the consumer to leave the vehicle unattended or cannot access the vehicle without the consumer’s help. In these cases, repossession agents might ask the consumer to provide access to the vehicle or for keys so that they can drive the vehicle away rather than tow it. If the consumer refuses, tempers can flare, and these situations become ripe for escalation.

In those cases, it is not uncommon to see the participants begin to threaten the use of force, with consumers attempting to defend their car and repossession agents attempting to enforce the right to take the vehicle. No matter who starts the threats , if violence becomes a possibility, then the repossession agent must stand down and leave the scene. Continuing in a repossession that has turned violent is a breach of peace that turns a legal repossession into an illegal one.

Police Assistance

Most repossession agencies will not attempt to take a car without first notifying the police. The repo companies do this to ensure the police do not mistake their agents for car thieves. While notifying the police is good practice that helps prevent accidental shootings and arrests, police involvement can go beyond what the law allows.

Police are charged with keeping the peace and insuring the safety of everyone in their jurisdiction. Often in repossessions, the police believe that this duty goes beyond simply insuring that people do not harm each other. Instead, police sometimes believe it is their job to assist the repossession company in taking the vehicle by instructing consumers to turn over vehicles, deliver keys to repo agents, or open locked garages.

Sadly, most police departments have yet to learn that this is not their job, and they have no legal authority to help in this way. These actions by police operate as “curbside courtrooms” and represent an illegal taking by the police. More importantly, not only are police prohibited from helping in repossessions, repo agents in Michigan are not allowed to ask for this help. By using police to help, repo agents open themselves to claims of civil rights violations as well as violations of collection law.

If your car was repossessed using one of these tactics, your rights may have been violated. If you would like a free consultation, call us today at (248) 208-8864. We can help you understand your rights and develop a plan to return your vehicle. The consultation is free and there is no fee unless we are able to recover for you.

Helpful Resources


Self-Help Resources:

  • Demand for Return of Vehicle
  • Demand for Return of Personal Property
  • Demand for Account Statement

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Recent Complaints

Legal Decisions and Statutes

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