Massachusetts Repossession Laws

Need Our Help?

We are lawyers. You might think that you cannot afford our help. However, if one of the following situations applies to you, we may be able to take your case on a contingency basis:

  1. You received a notice in the mail after your car was repossessed. Contact us to send us that notice, and we will review it for free to see if complies with the law.
  2. The repo agent breached the peace in the course of the repossession.

You may make contact with us at no charge.

Case Review

Car Repossession Laws Massachusetts

Often, repossession agents come unexpectedly, under the cover of darkness, and consumers wake up in the morning with a missing vehicle and no idea what to do. The good news is that you are not alone–thousands of Massachusetts residents before you have successfully weathered the storm. Below you can find answers to some of the most common repossession questions:

Was I properly notified?

In the lifecycle of a repossession, there are certain times when your lender must send you a written notice:

1

Notice of Default

If you miss a payment, your loan enters default and your lender must send a written notice called “Rights of Defaulting Buyer under the Massachusetts Motor Vehicle Installment Sales Act,” before a repossession. However, if you have been behind on payments in the past, it is possible your lender no longer has to send you this notice before repossessing your vehicle.

2

Post-Repossession Notice

Second, there is the notice that your lender must send after your repossession. This notice contains very important information about your lender’s plans for your vehicle and your post-repossession rights. It is a big deal if your post-repossession notice is incorrect or misleading, and we want to see any such notice you receive.

3

Notice of Deficiency

Even though your car has been repossessed, you still owe your lender the remaining loan balance, called a “deficiency balance.” However, your lender can only seek a deficiency balance from you if you still owed over $2,000 on the loan. Further, in Massachusetts, your lender must always credit you the fair market value of your vehicle. Your lender must send you a notice of deficiency, explaining the deficiency balance you owe based on the fair market value of your vehicle.
We want to see any post-repossession notices that you receive. Such notices can lead to valuable claims. You can get us your notices in a variety of ways. We will review them at no charge and respond to you.
  1. Email us a PDF to info@mass-legal.com;
  2. Fax us, 617-507-3456; or
  3. Take a photo of the notice with your phone and text it to (617) 657-9722 (or email the photo to info@mass-legal.com). If your notice is defective, you may be able to receive significant money damages.

There is also the notice after your car is sold at a private sale or public auction.

The same as above applies to this notice: We would like to see it.

Can I get my car back?

This is the first question on most people’s minds when they find out that their vehicle has been repossessed. The answer to this question is almost always yes, but for many it may not be practical or a smart financial decision to do so. Your lender is only required to hold your vehicle for 21 days before reselling it. After that point, nothing can be done to get it back, so if you want your vehicle back, you need to act quickly.

If you do make the decision to get your car back, you can do so in three ways:

1

Reinstatement

If you haven’t already done so, contact your lender and ask how you can get your vehicle back. The lender will either let you pay the missed payments and fees to get your vehicle back (this is called “reinstatement”) or tell you that you have to pay back the entire amount due on the loan (this is called “redemption). If you have never had a repossession before, it is common for lenders to agree to let you reinstate your loan. A lender is not required to offer reinstatement and, especially if you have a history of missed payments, may not do so. However, if you cannot reinstate your loan, you still can take advantage of options #2 and #3 below

2

Redemption

Even if your lender will not reinstate your loan, you always have the right to pay off the loan to get your vehicle back. However, many people do not have the luxury of being able to do this, especially on short notice.

3

Bankruptcy

In a Chapter 13 bankruptcy, you propose a repayment plan that lets you get your car back, provided that you repay the past-due amounts and continue to make your normal payments in a timely fashion. In certain circumstances, it makes sense to file a Chapter 13 to get your car back, but it may also be a better idea to let the vehicle go.

For more information about Chapter 13 bankruptcy click here.

Can a repo agent come onto my property?

If a repo agent enters onto your property without obtaining your permission when they enter, that is unlawful. Massachusetts has a special law on this topic. In most states, a repo man can come onto someone’s property (like a driveway) without permission and take a car, but not here.

A repossession company needs to get your permission at the same time they come onto the property that you own or rent. This includes a driveway or open (and, of course, closed) garage. However, there has never been a case in Massachusetts deciding exactly what this special law means. Do they have to call ahead of time? Can they come onto your driveway, knock on your door, and then get your permission? No court has decided. This is significant because most repos happen in the following way: the repo man comes on your property, tells you he is taking your car but that it will be much easier if you just give him the keys. The reason why it will be “easier” if you comply is the interesting part. Sometimes the repo man will say that towing the car would damage it, cost more, cause a commotion, or that he will call the police if you refuse to hand over the keys. All of these threats are illegal because they all coerce your compliance, and if they are communicated over your objection, they also breach the peace.

However, even when words and actions do not rise to the level of a breach of the peace, your lack of affirmative permission for the repo company to be on your property makes the repo illegal. However, if you ultimately give up the keys, it makes for a stronger case if you gave them up because of specific threats. Otherwise, in some circumstances, this could be interpreted as permission from you for the repo man to be on your property.

No repo company, here in Massachusetts or elsewhere, has the right to breach the peace in the course of a repossession. The reason for this is very ancient. The public peace belongs to society and its government (formerly the king) and no private person, including a repo agent, has the right to breach it.

A breach of the peace occurs when a repo agent uses force or threats of force against people or property. A repo agent also breaches the peace if he presses on with a repossession attempt after you object. The reason for this is that proceeding over an objection has the tendency to lead to violence. Despite this, this often exactly what happens: a repo attempt proceeds over a mild and confused objection. The devil is in the details when it comes to whether this is a breach of the peace. Whether something rises to the level of a breach of the peace usually depends on what acts or threats were involved and how “bad” it all seems in a common sense sort of way.

If a breach of the peace occurred you are entitled to an amount NOT LESS than the finance charge for the car loan plus 10 percent of the principal amount. This can be a large amount of money, so feel free to give us a call to discuss it if you think a repo man may have breached the peace in the course of repossessing your vehicle.

Should I keep my car or let it go?

Sometimes it can be a smart financial decision to let a car go, but this doesn’t come without consequences.

If you are paying a high interest rate for a deeply-under-water car it often makes sense to just let the car go (or, as an alternative if you really want it back, file a Chapter 13 bankruptcy, if certain limited circumstances apply to you). If you would like to let your car go, but it has not yet been repossessed, you may turn your car back to the lender through a voluntary repossession. Bring the car back, take off the plates (those are yours), leave the keys with the lender, and take photographic evidence of the process for your records. You will still be held accountable for the deficiency balance due to in personam liability. In Massachusetts, the deficiency balance is determined by the amount of the loan, minus the current fair market value of the vehicle.

If you do not take action to re-obtain your vehicle within 21 days, your lender has the right to sell the vehicle. For many car loans, lenders must apply the fair market value of the vehicle to your loan account. If the loan balance at the time of repossession is less than $2,000, the lender cannot pursue you for a deficiency after a repossession. However, many loan balances are larger and car lenders sue to collect these deficiency balances. People typically either negotiate these debts or file Chapter 7 or 13 bankruptcy to get discharged from the debt.

As discussed below, there are also some circumstances in which repossession notices are illegal and can defeat the debt. We specialize in spotting these violations.

What can I do now?

This is a really key question. Ultimately, you must decide the best course of action to take, but here are some helpful suggestions for next steps to take:

1

Call your lender

Ask whether they will agree to reinstate your loan and, if not, what amount you need to pay to redeem the vehicle. Even if you are letting the vehicle go, you should still contact the lender to get info about picking up personal possessions and to make sure that your lender has your correct mailing address.

2

Watch your mail

If your vehicle is repossessed or sold by your lender, they must send you certain notices. When you get these notices, we would like to see them. These notices may be the basis of a very valuable claim for money damages.

3

Contact an attorney

We take appropriate cases involving repossession rights on a contingency fee basis. If you feel your rights have been violated or you would like us to review your notices at no charge contact us.

Need Our Help?

We are lawyers. You might think that you cannot afford our help. However, if one of the following situations applies to you, we may be able to take your case on a contingency basis:

  1. You received a notice in the mail after your car was repossessed. Contact us to send us that notice, and we will review it for free to see if complies with the law.
  2. The repo agent breached the peace in the course of the repossession.

You may make contact with us at no charge.

Copyright © 2020 Law Office of Nicholas F. Ortiz, P.C. This site does not contain legal advice. Contact us if you would like to discuss obtaining legal advice.