What to do if I had a contract with someone by which they were to buy my car and make payments to me but they have stopped making the payments?

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What to do if I had a contract with someone by which they were to buy my car and make payments to me but they have stopped making the payments?

We entered into the contract about 6 months ago. I knew the person and didn’t have a problem working around her schedule/paychecks. I received a couple payments over 2 months and then nothing for the last 6 months. During this time I moved to another state (by former state of residence is where the other person lives and the contract originated). I have talked to the person multiple times but she now refuses to pay and says I’ll have to take the car back. The car isn’t worth much (probably only about $1000, if that since she was in an accident in it) so is it even worth it to try to get it back or sue her for the money?

Asked on June 7, 2014 under Business Law, Montana

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

Unless the agreement of sale specifically included a provision that if payments were not made, you could repossess the car (the car was security for the sale), you can't get the car back; all you could get is the balance or remainder of payments due under the contract. If you're in a different state, you could not sue in small claims court--you'd have to sue in "regular" county or district court. That effectively means you'd need an attorney, especially because suing across states, properly serving the other person in a different state, and then collecting (if you win and they don't pay voluntarily) is not easy. It is not likely to be economically worthwhile to sue unless you are owed more than $5,000 at this point.


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