Dealing with Debt

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Question: I we are surrendering our Motor Home(RV) to the bank for we cannot afford the monthly payments any longer. We are told after the RV is sold we are still responsible for the remmaning amt. owed. We think that amt. will be about $37000.00 which we cannot afford, what can we do at that point?

Answer:

AZLawHelp Question 22257:

Repossession of Property

Financing occurs when a person buys property (a vehicle, mobile home or furniture) but do not pay the entire sales price at once and the dealer or a bank (the creditor) lends you money so you can pay off the price of installments. The creditor takes an interest in the property until it is paid off. If you do not pay back the money as promised, the creditor has the right to take back, the property, through repossession. A.R.S.47-9609.  http://www.azleg.state.az.us/FormatDocument.asp?inDoc=/ars/47/09609.htm&Title=47&DocType=ARS

What happens if you fall behind on your payments?

If you are late on a payment, the creditor can choose to accelerate your loan. You will then owe the creditor the entire amount due on the loan. If you can't pay the entire amount due on the loan in a certain time period (usually 10 days), the creditor can then take back, or repossess, the property.
The creditor must follow the law when he repossesses your property. The law that applies will vary depending on where the repossession takes place. If your creditor follows the law, the creditor will eventually be able to repossess your property. A.R.S.47-9609. http://www.azleg.state.az.us/FormatDocument.asp?inDoc=/ars/47/09609.htm&Title=47&DocType=ARS

If the creditor takes you to court.

You will receive a notice from court telling you there will be a hearing.
•Explain to the Judge why you are behind on your payments.
•The Judge will decide whether to allow the repossession.
•Remember that if you are still behind on your payments at the time of the hearing, the Judge will probably order repossession.
•If you want to return a vehicle to the car dealer - ask the dealer to agree in writing to waive the deficiency (see below) in exchange for your "voluntary surrender" of the vehicle. A.R.S. 47-9610; A.R.S. 47-9615.

http://www.azleg.state.az.us/FormatDocument.asp?inDoc=/ars/47/09610.htm&Title=47&DocType=ARS

http://www.azleg.state.az.us/FormatDocument.asp?inDoc=/ars/47/09615.htm&Title=47&DocType=ARS

After repossession

after your vehicle is repossessed, or if you turn in the vehicle, the dealer will attempt to sell the car. The dealer must notify the debtor of the sale. If there is a balance still owing it is called a deficiency and must be paid by the debtor. The repossession and deficiency will be reported to your credit history and will damage your credit for approximately seven years. ARS 47-9615.

http://www.azleg.state.az.us/FormatDocument.asp?inDoc=/ars/47/09615.htm&Title=47&DocType=ARS

After deficiency judgment is entered

If a lender successfully wins a deficiency judgment against, the debtor is personally liable for the amount of the judgment. The debtor is legally required to satisfy the deficiency judgment, and the lender can go after them if they don't. They may be able to garnish wages, levy bank accounts, or take personal items (not necessarily your home, car, or other essential items).Retirement accounts are generally not at risk in a deficiency judgment, but check with a local attorney if you are at risk. A.R.S. 47-9615.
http://www.azleg.state.az.us/ars/47/09615.htm

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QUESTIONS

  • I we are surrendering our Motor Home(RV) to the bank for we cannot afford the monthly payments any longer. We are told after the RV is sold we are still responsible for the remmaning amt. owed. We think that amt. will be about $37000.00 which we cannot afford, what can we do at that point?

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