![]() If the contract says that the lender can use self-help to repossess the car, he can tow your car from your driveway, the street or your place of work. The lender can repossess the car in two ways: Either by using self-help or by filing a Claim and Delivery lawsuit. So, if you get behind in payments again, the lender does not have to send you another "Notice of Right to Cure." Also, if you are in default for a reason other than missing a payment or if you voluntarily surrender the car, the lender is not required to send a “Right to Cure” notice. You only have the right to get one "Notice of Right to Cure" for the entire term of the contract. If you do not bring your payments up to date after you have received the "Notice of Right to Cure," the lender can repossess your car. If you do bring the payments up to date, the default has been cured, and you can continue making regular monthly payments. Please note that federally-chartered credit unions are exempt from this law, and many federal credit unions will not send a Right to Cure in all cases. ![]() This Notice can only be sent once you are more than ten days late and it gives you 20 days to catch up your payments. If you fail to make a required payment on time, the lender must send you a "Notice of Right to Cure" the default. The most common of these things are: taking the car out of state permanently without permission from the lender, or failing to keep insurance on the car, or damaging the car so that its value is reduced. Usually, default is defined as the failure to make a payment when it is due, but many contracts also say that other things may be a default. So, make sure you read your contract carefully, especially the part that talks about default. ![]() Your rights and the rights of the lender when it comes to default and repossession are laid out in the contract you signed and in state and federal law. If you do, your contract will say what constitutes a default, allowing the lender to repossess the car. Usually, when you borrow money to buy a car, you have to use the car as collateral. Before a lender can repossess, or take back your car, you must have used your car as collateral for the loan and you must have defaulted on your contract with the lender.
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