Walk It Through: The Car Loan
A missed payment, what default means, the car a creditor cannot reach, and small claims.
A buyer pays a car loan a few days late after a hospital stay.
Two things a person in this spot might do. Picking one shows what the law says about it.
One car and one year. Voluntary surrender, the sale after repossession, a deficiency, insurance claims and the federal debt collection rules are not worked through here.
A practice walkthrough, not a prediction of how any real one will go. Legal information, not legal advice.
Words this turns on
Terms with a legal meaning that is narrower than the everyday one. Each links to the definition and the authority behind it.
- Breach of the peaceWhat a creditor repossessing without court must avoid: it may take collateral only without entering a dwelling and without force or other breach of the peace.
- Exempt propertyProperty a judgment creditor cannot take, such as household goods up to $1,000 an item and $7,500 in all, tools of the trade up to $10,000 and one motor vehicle up to $10,000.
- GarnishmentTaking part of a person's pay to satisfy a debt, limited to 25% of a week's disposable earnings or the excess over thirty times the federal minimum hourly wage, whichever is less.
- HomesteadA home occupied as the owner's principal residence, protected automatically against creditors up to $175,000.
- MaintenanceSupport a court may order for a spouse who lacks enough property for reasonable needs and cannot support themselves through work, in an amount and for a time the court finds just.
- Wrongful deathA death caused by the wrongful act or neglect of another, for which the heirs or the personal representative may sue within two years.
- Small claims departmentThe part of the magistrate's division that hears claims for money or property worth no more than $15,000, without a jury and without lawyers appearing at the hearing.