Can a loan company demand payment 1 1/2 yearsafter a repo?
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Can a loan company demand payment 1 1/2 yearsafter a repo?
Voluntarily reposed motorcycle a year and a half ago. Finance company sold it at auction. Called for 6 months after that. Now 1 year later calling for payment again. Company sold to new one. New one calling now. Can new one collect? Didn’t recall signing paper if vehicle the roped I would pay off.
Asked on June 20, 2011 under Bankruptcy Law, New Mexico
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 13 years ago | Contributor
1) As a general matter, repossession of a motorcycle or car does not, by itself, eliminate the debt. When the vehicle is repossessed and sold, the proceeds of the sale are applied against the remaining amount owed on the loan or under the financing agreement; if the proceeds do not pay off the loan in full (which is likely), then the lender may sue for any remaining balance left.
2) If a company is purschased by another one, the new company generally owns any debts or claims of the prior company and may proceed on them as if they were its own debts or claims. Similarly, the debt or claim can itself be sold to someone else, who will then try to collect on it.
So from what you write, it appears that they can do this.
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