In Arkansas, defaulting on a loan or not paying your car insurance fees are sufficient grounds for repossession. However, if a repo agent breaches the peace or takes any personal items that are in your car, you may have grounds for getting fines or damages paid back to you. After your car is repossessed, you may still have a chance to buy it back if you can pay all the fees.
You'll always want to consult an attorney before taking any legal actions concerning a repossession. Arkansas repossession law is based not only on statutes, but also on opinions from case law.
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Circumstances for Repossession
In Arkansas, the person or entity that loaned you the money to buy your car can repossess it after you've defaulted on your loan. Arkansas repossession laws don't specify exactly how quickly this can happen. The loan contract that you signed when you purchased your car should spell out how just how quickly your loan goes into default after missing a car payment. According to Arkansas Law Help, your car can also be repossessed if you stop paying for your car insurance or if your car insurance has been suspended or dropped.
Breach of Peace
In Arkansas, creditors are not allowed to breach the peace when possessing your car. This means that they cannot threaten physical force, use any physical force or take your car from a closed garage unless you give permission. Creditors can't take any personal property that's in your car when they repossesses your vehicle. Upsolve reports that you can contact either the repo company or the dealership to arrange to collect the items that were left inside your car.
If a creditor does breach the peace, he may not be forced to return the car, but he may need to pay a penalty or repay you for any damage to your property.
Working With Your Creditor
Before your problem reaches the point of repossession, try to work something out with your creditor. If you know you're going to be late with a payment, let your creditor know and see if he'll give you a temporary delay or alter your payment schedule. Not all creditors will work with you, but it's definitely worth a try.
Options After Repossession
You may still have some options after repossession. Your creditor can keep the car as payment for debt, or he may sell it privately or in a public auction. Legally, the creditor is required to let you know what he's planning to do with the car and, if a public auction happens, what time and place it will occur. If he opts for a private sale, he must let you know the date of the sale.
You have a chance to buy your car back, but remember that the cost will be higher than it was before repossession. Not only will you likely have to pay any past-due payments along with the remaining debt, but you'll also have to pay for attorney fees, sale expenses and storage fees.