If you default on your car loan payments, your car loan lender has two ways to take your car back: repossession and replevin. Creditors usually prefer to use repossession because it's faster and less expensive than replevin. However, creditors may use replevin when repossession is not an option. (To learn how replevin works, see Car Repossession v. Replevin.)
Here are some situations where a creditor might use replevin to take back your car if you default on the loan:
Most states allow car lenders to come on to property and seize vehicles—without notice to the borrower—as long as their action does not breach the peace. “Breach of the peace” has been defined to include:
If any of these or other events are likely to occur if the lender tries to take your car, it may resort to a replevin action instead. (Learn more about how motor vehicles are repossessed.)
Just because the car-loan lender may have a right of repossession does not mean that you are obligated to hand the car over to that creditor. If the car is hidden or missing from the location where the creditor expects to find it, then the creditor cannot legally make you do anything. Instead, the creditor must seek a replevin order from the court. Once the court issues and serves you with an order of replevin, then you are required to produce the car or disclose its location.
As with the case of a hidden or missing car, the car-loan lender cannot make you open your garage or unlock your fence. Because the creditor also cannot legally break the locks, cut chains, or do anything else that might cause damage to other property or otherwise breach the peace, it must first seek a replevin order. Once the court issues and serves you with an order of replevin, then you are required to produce the car to the creditor. Alternately, the creditor may arrive with a Sheriff and cut locks to access the vehicle, if necessary.
Creditors will also resort to replevins when repossessions are not allowed or questionable.
Here are some other reasons:
For more information about car repossession and replevin laws in your state, consult with a local attorney.