|
What is
Repossession?
Quick Answer:
Repossession is the process of a
lender or his agent taking back
items that were bought on credit or
were pledged as collateral for a
loan from a borrower who has fallen
behind on loan payments.
Repo Company-1
See more Definitions
of Repossession
Detailed Answer:
Repossession is generally used to
refer to a financial institution
taking back an object that was
either used as collateral or rented
or leased in a transaction. This is
usually done in accordance with a
purchase contract or credit
contract, in which the consumer
agrees that the seller may repossess
the object if the signers are past
the grace period (generally for
prime lenders the critical number is
30 days late making an installment
payment but can vary based on how
many payments have already been
made, the length of the business
relationship, reason why past due,
etc.) Contracts that authorize
repossession also usually specify
additional fines that the consumer
must pay to the seller, ostensibly
to cover the seller's costs of the
repossession and of depreciated
value of the object, as the seller
is now in possession of a "used"
object. Generally lending
institutions never want to repossess
because the items sold at a
wholesale auction and were financed
at retail price, hence, a loss is
virtually guaranteed. However, the
statisticians and accountants have
determined that any loan which goes
beyond 90 days past due will never
again become "current" (up to date
on payments) and the collateral
continues to depreciate.
Repossession is a complicated and
legally fraught matter, with
legality being determined by widely
varying local and state laws. In
some jurisdictions, such as the
United States, a consumer may avoid
repossession of some of his property
by declaring personal bankruptcy,
throwing his financial arrangements
on the mercy of a court, which will
usually prevent the consumer's house
and, sometimes, his car from being
repossessed. Both repossession and
bankruptcy are significant negative
events on a consumer's credit
report.
If a lender finds itself in the
situation of needing to repossess
property while the borrower attempts
to avoid this, the dealer may
contract the work of repossession
out to a repossession agent
(colloquially termed a Repo Man, as
fictionally portrayed in the film of
the same name). Agents appointed by
the courts are called bailiffs.Repo Company-2
Learn how to become a repo man in our Free
Repo Company Information section.
Learn more about Quick-Repo.com
Repo Company-1:
www.ots.treas.gov
Repo Company-2:
Repossession. (2006,
October 15). In
Wikipedia, The Free Encyclopedia.
Retrieved from
http://en.wikipedia.org/w/index.php?title=Service_of_repossession&oldid=77311963
|
