Serving: All of Texas, including Austin, Dallas, Houston, San Antonio, El Paso, Corpus Christi, Lubbock, and Laredo
The Trueblood Law Firm, with offices in Austin, Houston, and Dallas, are Texas consumer repossession attorneys who specialize in repossession law, and suing for breaches of the peace. We are not bankruptcy attorneys, but instead help you sue the lender and repossession agency for unlawful repossessions.
There are significant penalties available to consumers under Texas law for wrongful repossessions. Please call or email us for a low-cost consultation if you identify a potential violation of Texas repossession law in your case. An overview of Texas repossession law is presented below.
Does the lender have to give advance notice of a repo?
No. There is no requirement of advance notice of a repossession in Texas, except for mobile homes. The lender can repossess your car if you are even one day late on your contract. The exception might be if the lender promised not to repossess upon receipt of certain payments.
Can they repossess my vehicle for a late payment, when I’ve been paying late every month?
This will depend on your particular case. The contracts usually provide that the lender doesn’t waive its rights by accepting late payments. However, there is a body of law holding that a repo can be illegal if the lender has repeatedly held off on repossession after receiving late payments.
What is a “breach of the peace” under Texas law?
Here are some typical breaches of the peace: (1) entering a secured area (gated, fenced, or guarded) without the owner’s permission; (2) entering an underground parking garage by tricking the code or following a car in; (3) breaking or opening any lock, door, or gate; (4) taking the car after an oral objection by the consumer, made before the car is hooked up; (5) damaging the vehicle during repossession; (6) blocking or lifting the vehicle while someone was in it; (6) any violence, pushing, or touching of the consumer; (7) making a public disturbance such as shouting, honking horns, or contacting neighbors; (8) moving other cars that were blocking the towed vehicle; and (9) threatening you with arrest or bodily harm.
Can the repossession agency trespass into my underground garage or secured area?
No. They cannot break into a garage, or trick the code on your gate, or follow another vehicle into the garage. If they did, the repossession agency and lender are liable for wrongful repossession.
Can the repossession agency use force or touch me?
No. The repossession agent cannot breach the peace when taking your vehicle. They cannot use violence or touch or push anyone.
Do I have a right to get back my personal property in the vehicle?
Yes. The tow truck company may charge you $5-$20 per day for vehicle storage, but cannot charge you anything to recover your personal property in the vehicle. Texas Occupations Code § 2303.155(f). The Texas Department of Licensing and Regulation, which regulates tow companies, says on its website that “You may have access to your car to recover personal property. You do not have to pay a fee to do this.” In addition, the tow company must allow you access to the console or glove compartment, without charge, to retrieve any identity documents, or vehicle ownership documents, which are in there. Texas Occupations Code § 2303.158.
You are supposed to get three written notices after a Texas repossession! Here they are:
1. Under Texas Finance Code § 348.407, the lender must mail or deliver you a notice, to your last known address, within 15 days of discovering that there was personal property in the vehicle. The notice must state that (1) you can claim your property within 31 days after mailing of the notice; and (2) give the location and operating hours of the place where you can claim your property. If you don’t claim your property within the 31 days, the lender can dispose of it. If the lender doesn’t send you the notice, and your goods are sold, the lender could be liable for three times the value of your property. See Texas Finance Code § 349.003.
2. The tow truck operator must send the registered owner a notice by certified mail, return receipt, within five days of the repossession. Texas Occupations Code § 2303.151. This notice has to explain the daily vehicle storage rate, the first day on which storage charges are calculated, the type and amount of any other charges to be paid when the vehicle is claimed (such as personal property fees), and the facility’s operating hours. Texas Occupations Code § 2303.153.
3. The lender must send you a written notice of the sale of your vehicle, at least ten days before the sale. If the lender’s notice doesn’t have everything that is required, you will not have to pay a deficiency balance. Only a consumer lawyer can tell you if your lender’s notice complies with the law. It is definitely worth it to have a lawyer look at the notice, since you might escape paying the deficiency balance, a very big benefit to the consumer.
How do I get my car back from the lender after the repossession?
Unfortunately, there is no right of reinstatement in Texas (reinstatement means getting your car back by paying only your past due payments). You are entitled to “redeem” the contract by paying the entire loan balance and taking title. Of course, not many consumers can afford that. You will receive a notice in the mail from the lender. The notice will state that you have a right to “redeem” the contract within ten days by paying the full contract balance, and any repossession fees.
What will I owe if I do not redeem?
If you cannot afford to redeem, or you leased, the vehicle will be sold at auction, generally ten days after issuance of the written notice of the sale. The creditor will apply the proceeds of the sale to your loan balance, and you will owe the rest, which is called a “deficiency balance.” Many people are shocked that they owe so much after the auction sale, because they do not realize that the auction prices are wholesale prices.
It is definitely worth it to have a lawyer look at the notice of sale that the lender sent you, since by law, you will escape paying the deficiency balance (the debt left over after your car is sold) if that notice is defective.
I am being sued on a deficiency balance. What should I do?
If you have already been sued after repossession, do not ignore the lawsuit! Seek out a consumer attorney immediately, well before the answer date on your summons, or you might lose your legal rights. You cannot just call or write a letter to the court. You must file an official response in court, by your answer date. The deadline to respond is not the first scheduled court date, but the answer date on your summons. Give us a call to see if you can counter-sue the lender for wrongful repossession, or to see if you have a defense to the lawsuit. Please don’t ignore the lawsuit, because the consequences are severe.
I bought a car, I am current on my payments, and the car dealer is harassing me to sign a new contract and threatening to repossess. What do I do?
The dealer is doing this because they were unable to find a lender for your contract. That is not your problem, it is the dealer’s. If the dealer notified you within ten days of signing the contract that it wanted to cancel the transaction, then they are within their rights, and you should give the car back and get your down payment/trade-in back. But if the dealer waited more than ten days to notify you that they were canceling, you have the right to keep the car and make payments to the dealer (not to any bank who may have been discussed). The dealer has no right to repossess your vehicle or harass you with phone calls, so give us a call if they do.
Do you handle wrongful repossessions under leases?
Yes. Texas Business & Commerce Code § 2A.525(c) prohibits breaches of the peace as to leased vehicles. Therefore, both the lender and the repossession agency are liable for a breach of the peace. However, in Texas, there are no automatic, minimum penalties for a wrongful repossession of a leased vehicle, as there are for purchased vehicles. Instead, there are penalties available under the federal Fair Debt Collection Practices Act ($1,000), and the Texas Deceptive Trade Practices Act (three times actual damages).