John Roska: What your rights are on repossession
Q: They're threatening to repossess my car because of missed payments. If that happens, what are my rights? Can I catch up the payments, and get my car back?
A: Once a car's repossessed, all buyers have the right to pay off the loan in full, and get their car back. Because you're paid in full, you get title, too. That's the right to redeem.
Some buyers have the right to catch up missed payments, and get the car back. That's the right to reinstate. You have it only if you've paid at least 30 percent of the total of payments due.
The absolute right to redeem is in Article 9 of the Illinois Commercial Code. Post-repo, you can redeem any time before the lender has sold what was repossessed. In addition to paying off the loan in full, you can also be required to pay repo costs and attorney fees.
Redeeming makes you the owner. The loan's paid in full.
The limited right to reinstate is buried in the Illinois Vehicle Code. If the car's repossessed, and you've paid at least 30% of the total purchase price, the law gives you 21 days to catch up all missed payments and late fees.
You also must cure any non-money defaults (e.g., get insurance). And as with redeeming, you can be required to pay repo costs and attorney fees.
The law says that reinstating "restores to the owner his rights under the contract or loan agreement as though no default had occurred." You're all caught up, and back on track.
You only get to reinstate once, though.
If you qualify for the right to reinstate, you're supposed to get written notice of that right within 3 days of the repo. That notice can be included in the regular notice that you're supposed to get after any repo, telling you when and how the car's going to be sold.
So, everybody has the right to redeem after a repo, and the right to a notice of proposed sale. Some people have the right to reinstate.
Otherwise, the only right you have after repo is to recover your personal property from the car. That's in the Collateral Recovery Act.
The repo man's supposed to tell you in writing within 5 "working days" after repo "of the whereabouts of personal effects or other property." You get at least 45 days to come get it. They can charge for "any reasonably incurred expenses for inventory and storage."
Repo law is a last bastion of "self help" that's legal. If you default on a secured loan, the lender can repo the collateral on his own, Wild West style, without any kind of court case or order.
There's only 2 limits on the repo man: he can't trespass, and he can't breach the peace. But, a little trespass is OK (driveways, open garages), and what constitutes a breach of the peace isn't clear.
No Illinois case has found a breach of the peace that makes a repo illegal. One case says it's not enough to angrily tell the repo man "Don't take it," and hints that things must escalate beyond that.
John Roska is a lawyer with Land of Lincoln Legal Assistance Foundation. You can send your questions to The Law Q&A, 302 N. First St., Champaign, IL 61820. Questions may be edited for space.