Will Trading in Your Car Stop a Repossession? In circumstances of potential repossession, exchanging your car might look like an ideal plan but you are bound to violate several legal and moral limitations. An analysis from different angles:
The Specifics of Repossession Risks
Potential consequences: Falling under the category of fraud, trying to trade a car rather than have it repossessed can lead hybrid case bait and switch.repossession (ad) For example, if you are committing a fraud and selling/trading your car while being delinquent on payments to avoid the repo process this can be definitely subjectable to major legal consequences14.
Deal with Dealers: you cannot hide where your car comes from as dealers do background checks when taking in trade-ins. If they find that you are late on payments, replicate it or deny the trade additionally muddies your financial situation2.
Alternatives to Trading In
Voluntary Repossession: Rather than trading, you may allow for a voluntary repossession and return the vehicle to the lender. This may help you avoid other fees and further damage to your credit which can be incurred by involuntary repossession5.
Request Payment Plans or Deferments: Reach out to your lender and consider a payment plan. If repossession is averted, many lenders will work with borrowers to develop affordable payment programs.
Consumer Protections
Learn Consumer Protection Laws: Know the rules about repossession. For example, the peace cannot be disturbed and if you believe your vehicle was wrongfully repossessed there are ways to go about it legally46.
If you have any doubts or issues check with an auto fraud attorney12 for legal advice specific to your situation.
In conclusion, while swapping your car out might seem like the easy way to avoid a repossession…it can be dangerous and could have some legal consequences. Pursuing alternatives such as voluntary repossession, negotiations with the lender can lead to even better results.
