Can I be sued from a “buy here/pay here” car lot, if I a carbe repossessed bythe seller?

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Can I be sued from a “buy here/pay here” car lot, if I a carbe repossessed bythe seller?

I bought a car 4 years ago; 2 years later the engine blew up for the second time. I had the car towed to the repair shop. I then called the seller and told him I was done with the car and that he could come get it or have it towed to his lot. I didn’t hear anything. Then today, I got papers stating I’m being sued for not paying the car off. I haven’t had the car in my posession for 2 years. Can I fight this?

Asked on October 15, 2011 under Bankruptcy Law, Indiana

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

When a car is repossessed, it will be sold by the lender/dealer/etc. (whomever financed it) and the proceeds applied against the remaining balance of the loan or financing. If the loan is not fully paid off by doing this, the lender/seller has the right to sue for any unpaid amount. Since the car had a blown engine, it probably did not sell for much, so if there was still a balance on the loan when you gave the car up, it probably was not paid off by then repossessing and selling the car; that means that the seller may indeed sue you. (Just to reiterate: the seller taking the car back does NOT mean it can't sue you; it just means that the value of the car is applied against what you owe.)

In IL, someone can sue on a promissory note for up to 6 years after it was violated, and on a written contract up to 10 years. Therefore, whether the financing here was based on a promssory note or a contract/agreement, it would appear that you could be sued 2 years later.


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