Repossession Laws In California

In California, a consumer’s vehicle can be taken from them if they miss payments on their loan or if they violate any terms of their agreement. This process is known as repossession and the creditor has the right to repossess the consumer’s vehicle if it holds a valid security interest in it. There are repossession laws that the creditor has to follow and these laws also provide the consumer with a number of rights during this process. Understanding California’s laws can benefit consumers if they are faced with repossession.

Is a breach of the peace illegal in California?

Yes. In California, a breach of the peace will render repossession unlawful. Due to the law, repossession companies are limited in what they can and cannot do during a repossession. For example, they are not allowed to be a risk to the consumer in any way. This means that they cannot use violence, physical force, or threats when attempting to repossess a vehicle. They also should not tell consumers incorrect information about the purpose of the repossession. Additionally, the repossession company must respect an individual’s property during a repossession. They are not allowed to harm private property and without the consumer’s consent, they cannot enter into a private building or secured area such as a locked garage to conduct a repossession. However, they are able to repossess a vehicle if it is parked in a parking lot or a garage that is open to the public. The repossession company has to stop the repossession if the consumer makes any objections to their actions. If they do not, a breach of the peace may occur. In order to avoid a breach of the peace, repossession companies may carry out repossessions when the consumer is not present or when they are asleep. However, these repossessions may still breach the peace if they result in damage to the consumer’s property.

Is a pre-repossession notice required to be sent to a consumer?

No. In California, consumers are not required to be sent a pre-repossession notice. If the creditor has a security interest in the vehicle, they can lawfully conduct a repossession after the consumer is in default.

What can a consumer do after repossession has occurred?

There are still a set of rules that the creditor and the repossession company must follow which guide their actions for the post-repossession process.

Within 48 hours of the repossession, the repossession company has to send the consumer a Notice of Seizure. This letter should include the name and contact information for both the creditor and the repossession company, as well as storage fees for the vehicle.

The repossession company also has to send the consumer an Inventory of Personal Effects, which lists out all of their personal items that may have been left inside of the repossessed vehicle, how they may reclaim these items, and the cost of storage. The individual has 60 days to retrieve their items and if they do not do so within this time period, the repossession company is allowed to dispose of their property. It is important to note that consumers are not entitled to reclaim items that are considered to be attachments to the vehicle (e.g. stereo systems).

After the repossession, the creditor has the right to sell the vehicle at a public or a private sale. Before the sale occurs, they must send the consumer a pre-sale notice. The notice has to be sent at least 15 days before the sale and if the creditor wishes to collect a deficiency balance, which is money that the consumer may still owe on the debt following the sale, they must send the notice within 60 days of the repossession. The notice must provide the consumer with information about the sale but it also has to include information about their right to reinstate the loan and redeem the vehicle (which they can do anytime prior to the sale). In order to reinstate the loan, the consumer has to pay back all of their missed payments and any late fees or costs accrued by the creditor. If they do so, they will be able to receive the vehicle back and return it to their pre-default rights. A consumer is only allowed to reinstate a loan once every 12 months and twice over the length of their entire contract. They can redeem the vehicle by paying back the entire balance on the loan, in addition to possible fees and costs. If they want to reinstate or redeem, they can request a 10-day extension that provides them with more time to do so.

At the sale, the creditor has to sell the consumer’s vehicle in a commercially reasonable manner. Selling the vehicle significantly under its average market value could be an indication of unlawful conduct. After the sale, the creditor should provide the consumer with a post-sale accounting which includes the vehicle’s selling price, a breakdown of how the funds were used, and the amount of a surplus or deficiency. Before the debt can be paid with the money from the sale, any reasonable expenses that the creditor accrued must first be covered. Afterward, if the money that remains can fully cover the consumer’s debt, they are entitled to any surplus that is left over. However, if the money cannot fully cover their debt, they may have to pay for the deficiency balance.

What happens if a consumer’s vehicle was wrongfully repossessed?

A consumer’s vehicle may have been wrongfully repossessed if they were not sent a Notice of Seizure, an Inventory of Personal Effects, or a pre- or post-sale notice. If the repossession was unlawful, they would not have to pay for the deficiency balance. Additionally, it is possible that the repossession company violated the Fair Debt Collection Practices Act (FDCPA) during the repossession by breaching the peace or repossessing the wrong vehicle. The FDCPA is a federal law that protects consumers from the unlawful actions of debt collectors. If a violation of the FDCPA occurred, then pursuant to the Act, the repossession company would have to pay the consumer compensation of up to $1,000 in statutory damages. They would also have to pay for the consumer’s legal fees and any costs.

Where can a consumer look for help or for answers to their questions?

In the state that a consumer resides in, a consumer protection agency, the Office of the Attorney General, and/or a consumer protection attorney who is licensed in a consumer’s respective state can assist a consumer in getting help and/or determining the answers to their questions in regard to the aforementioned laws. The Consumer Financial Protection Bureau can also provide assistance to consumers.

Practice Areas

Repossession Laws in California

When a vehicle is repossessed, the experience can be intimidating, confusing, and financially devastating. Understanding California Repossession Law is critical for any consumer facing default, receiving collection threats, or discovering their vehicle missing without warning. At Rights Protection Law Group, PLLC, our law firm believes every consumer deserves a clear explanation of their rights—and a strong advocate prepared to hold lenders and repossession companies accountable. Whether a consumer is navigating wrongful repossessions, fighting for their personal property, or disputing unlawful deficiency balances, an experienced California Repossession Lawyer can make all the difference in advising a consumer on how to protect themselves.

California has some of the strongest consumer protection rules in the nation, and creditors must follow strict legal procedures when attempting to take a vehicle. A violation of these procedures can give consumers powerful leverage against the creditor. It is important to know exactly what the law requires and what steps can be taken if those rules are broken.

Understanding When a Vehicle Can Be Repossessed in California

Under California Car Repossession Law, a lender may repossess a vehicle when a borrower is in default on their auto loan. Default most commonly occurs after missed payments, but the loan agreement may define other default conditions as well. A creditor is not required to provide advance notice before initiating repossession, but they must have a valid security interest in the vehicle and must follow California’s consumer-protection statutes at every step of the process.

Even though notice is not required beforehand, the way the repossession is carried out is heavily regulated. If the repo agent violates these laws, the repossession may be unlawful—and a California Auto Repossession Lawyer can use these violations to help consumers seek compensation, or dismissal of a deficiency balance.

Breach of the Peace Under California Vehicle Repossession Law

One of the most important limitations on creditors is California’s strict prohibition against, “breach of the peace.” Under California Vehicle Repossession Law, a repossession becomes unlawful if the repo agent uses threats, force, intimidation, or any conduct that disturbs public order. This includes, but is not limited to:

Using physical force or verbal aggression; and
Breaking into a locked garage or secured area; and
Continuing the repossession after the consumer objects; and
Damaging the consumer’s property.

If any of these actions occur, the repossession may violate state law—and potentially the federal Fair Debt Collection Practices Act, 15 U.S.C. § 1692, et seq. A California Vehicle Repossession Lawyer or California Repossession Attorney can help determine whether the creditor’s conduct amounts to a breach of the peace and what remedies may be available.

Your Rights After the Vehicle Has Been Repossessed

Even when the repossession itself is lawful, creditors must comply with strict requirements after taking the vehicle. California Repossession Law mandates that consumers receive a Notice of Seizure within 48 hours of the repossession. This notice must include:

The name and contact information of the creditor; and
The name and contact information of the repossession company; and
The amount of storage charges and how to retrieve personal items.

Consumers must also receive an Inventory of Personal Effects. California law requires repo companies to safeguard all personal belongings left inside the vehicle, and that they give a consumer sixty (60) days to recover them. A failure to provide proper inventory or access to personal property may give rise to legal claims, and consulting a California Car Repossession Attorney can help preserve your rights.

The Right to Reinstate or Redeem the Loan

One of the most powerful rights available under California Car Repossession Law is the consumer’s right to reinstate the loan. Before the vehicle is sold, the creditor must send a pre-sale notice, which explains:

The date, time, and location of sale; and
The consumer’s right to reinstate the loan; and
The total amount needed to redeem the vehicle; and
How the sale proceeds will be used.

To reinstate, the consumer must pay all missed payments, plus late fees and allowable costs. Under California law, a consumer may reinstate the loan once every 12 months and twice during the entire contract term. Alternatively, a consumer may redeem the vehicle by paying the full balance owed on the loan.

If the creditor fails to provide the necessary notices or refuses reinstatement when the law requires it, a California Auto Repossession Attorney can intervene and challenge the creditor’s actions.

Deficiency Balances and Post-Sale Accounting

After the sale, the creditor must provide a detailed post-sale accounting explaining:

The vehicle’s sale price; and
How sale proceeds were applied; and
Any remaining deficiency balance.

If the vehicle is sold for far less than its fair market value, or if the creditor fails to provide accurate accounting, consumers may dispute or seek elimination of the deficiency. An experienced California Car Repossession Lawyer can examine whether the sale was “commercially reasonable,” as required by California Auto Repossession Law.

Unlawful or unreasonable sales may erase the consumer’s obligation to pay a deficiency balance altogether.

Wrongful Repossession in California

A repossession may be considered wrongful in certain situations, including, but not limited to:

The creditor did not have the legal right to repossess; and
The consumer was not in default; and
The repossession company breached the peace; and
The wrong vehicle was repossessed; and
Personal or real property items were destroyed, or stolen, during the attempt to take the vehicle.

Under California Vehicle Repossession Law, consumers may recover damages for harm caused by wrongful repossession. In some cases, violations of state and federal debt collection laws allow for consumers to recover statutory damages, actual damages, and attorney fees and costs. If a consumer believes that their rights were violated, contacting a California Vehicle Repossession Attorney immediately can help them in fully understanding the need to preserve evidence, and to protect your legal options.

How a California Repossession Lawyer Can Help

At Rights Protection Law Group, PLLC, our law firm understands how stressful and financially disruptive a repossession can be. Hiring a knowledgeable California Repossession Lawyer or California Auto Repossession Lawyer provides critical advantages, including, but not limited to:

Reviewing whether the repossession was lawful; and
Challenging deficiency balances; and
Negotiating with creditors; and
Filing claims for breach of the peace or unlawful conduct; and
Recovering damages for lost property; and
Holding repo agents accountable for violations of federal and/or state laws.

When creditors overstep their authority, consumers have powerful legal protections. Our law firm is committed to trying to help attain the enforcement of those rights, and in so doing to help our clients regain financial stability.

Speak With a California Car Repossession Attorney Today

If a consumer’s vehicle has been repossessed and/or if a consumer believes that any of their rights have been violated under California Repossession Law, the consumer does not have to face the situation alone. Regardless of whether they are referred to as a California Car Repossession Attorney; a California Auto Repossession Attorney; or a California Vehicle Repossession Attorney; one can guide a consumer through every step of the process, explain the consumer’s options to the consumer, and help the consumer to try to attain the justice that the consumer deserves.

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