IfI put up a motorcycle as collateral for bail but haven’t made the schedule payments, will that forfeit my collateral?

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IfI put up a motorcycle as collateral for bail but haven’t made the schedule payments, will that forfeit my collateral?

Nothing in Bond Contract that states this action; was told over the phone that I could not get collateral back because payments weren’t made. Only states that a 10% fee assessment could be added.

Asked on February 3, 2011 under Bankruptcy Law, California

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

The very purpose of collateral is to give the lender or creditor something he, she, or it can use to collect in the event payment is not made. Collateral is *meant* to be forfeited by a debtor who does not make his or her payments as scheduled. Therefore, if the borrower--or as here, the person needing bail--doesn't make payments as scheduled, the creditor can take the collateral. The fact there 10% fee assessements are possible means that you could additionally be charged another 10% over and above what else you owe--it does not prevent the creditor from taking the collateral, but rather allows them to impose additional charges on you.


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