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Collections Law/Costs after repossession

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Expert: Regan Shinski - 2/10/2011


Question
My husband's lawn mower was repossessed. Now he received a letter that he owes $2500 for lawyer and repossession fees. The mower sold for enough to pay off the loan.  Does he have to pay that?

Answer
It's going to depend on the contract and your state laws.  However, most do allow for reasonable attorney, repossession, and collection costs.  It's hard for me to say if you owe $2500 or not without knowing the details of the contract and how they are allocating the costs.

You should ask for debt validation under the FDCPA from the attorney or collection agency that is collecting the debt.  They should then provide a listing of how this amount was arrived at.  From there it is a matter of fighting or negotiating the amount.

You may also want to look into if they repossessed the unit in a legal fashion.  Look up repo laws in your state.  I'm not talking about if you were behind on the payments or if you really owed the debt.  I'm saying to check that they followed the legal guidelines of your state.  Most states have laws to govern the time-table, how you are notified, and how they re-sell the unit.  If they even slightly deviated from these laws - which is more common than most people think - then it was not a valid repo and you would not owe any shortfall.

Regardless of where you stand at this point, you should start your credit repair immediately.  Delays mean you could be more likely to live with this on his reports for the full seven years.

Good luck, I hope this helps,
Regan

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Regan Shinski

Expertise

I can answer questions on collections, repossessions, bankruptcy, credit repair, credit counseling, FICO scores, credit planning, and the cause and effect of credit related decisions. I can also answer questions on collection settlements and preparing to sue your creditors for false debts and credit credit reporting.

Experience

Fifteen years ago I was financially devasted due to severe health issues. I filed bankruptcy, had a foreclosure, car repossession, tax lien, and ruined credit. I immersed myself in credit law. I settled dozens of accounts and had them removed to improve my credit. I personally sued four creditors and collection agencies and won cash settlements for their false reporting on my credit reports. Since then, I have completely recovered and have nearly $100,000 in revolving credit lines and perfect credit. I have owned a credit repair company for the past five years and have an additional three years of specific work in the collections and debt management industry. I am fully versed in the Fair Debt Collection Practices Acts (FDCPA), Fair Credit Reporting Act (FCRA), and have used them successfully in collection settlements and lawsuits for myself and others. I am also familiar with and abide by the Credit Repair Organizations Act (CROA). I have deleted or helped delete literally hundreds and hundreds of derogatory items from consumers' credit reports and helped negotiate many settlements with collection agencies and creditors. I have also advised people on bankruptcy at any stage. In the current credit market, I have successfully advised numerous people on how to obtain credit and how to negotiate for better terms.

Education/Credentials
BA University of Minnesota

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