Illinois reposession laws

Can anyone tell me if Illinois is a cure state? Does Illinois state laws require written notice of default-right to cure before repossessing a vehicle? Can Wachovia come after us for the difference if the vehicle is sold at auction? Wachovia Dealer Services came and took our vehicle (had a key made) while parked at work. It turns out I have been sending my payments to the wrong address. We have changed banks and my old bank has informed me that digging through old checks for an x customer is not their top priority and will take a couple of months. The payments eventually get to Wachovia after being forwarded by the post office. I suspect since I never got any bills and no responses to get copies of the bills and declining balance there is a possibility I am still one payment behind. They say now I cannot have the vehicle back without coming up with $17,000. The vehicle was in a reaffirmation agreement. Our chapter 7 was discharged 2 years ago. Our attorney says there is nothing he can do about it. I spoke with the President of Wahovia's assistant yesterday, who was very nice and attentive. Does anyone have a sample letter I can send the President directly begging forgiveness and a chance to start over? Its a last ditch effort I know, but if they can bill me for the difference why not attempt to get the truck back and continue making payments. Your responses would be greatly appreciated.

No, IL laws do not require them to send a cure letter (... except if the loan was originated after 4/1/09 and has an APR in excess of 36%, then there's some notice requirements per "Title Loan" statues). Any time an account is in default, even if only 1 day late, a creditor can repossess the collateral without notice.

In short, yes. They must give you 21 days to redeem the vehicle by paying the amount the demand. The amount they can demand is based on certain factors: 1) If you've paid at least 33% of the payments before repossession, and the car has not been repossessed in the past, then they can only demand the past-due amount + costs of repossession + proof of insurance; 2) if you have not paid at least 33% of the payments prior to repossesssion, or if the car had been repo'd in the past, then they can demand the entire balance plus costs of repossession.

If you do not redeem the vehicle within 21 days, then they can sell the vehicle. They must sell the vehicle in a commercially-reasonable manner, which usually means selling it to highest bidder at public or private sale auction. Proceeds from the sale (after deducting auction fees, towing, etc) will be applied to your account balance. Any remaining deficiency balance is a legal debt owing, and they can collect on it.

That confuses me, to a degree. Were you mailing your payments to the same place you mailed them before the bankruptcy? I've never heard of a huge company just up and changing their payment address. Usually if they physically move, they keep the same PO Box for payments.


Now I just wonder - did they contact you at all? (If not, do they have good contact info for you?) Generally at first notice of BK, they'd turn off late notices and keep the account off their call lists. But in a reaffirmation they are not bound by the stay of collection any more. At least on my accounts that are re-affirmed, we'll turn the late notices back on and make phone calls when the account becomes delinquent. I mean, I'd definitely try to call our customers first before entertaining the idea of a repo.

You can write the president; I don't have a sample letter but just explain yourself -- what happened and why? Quite honestly, though, the Presidents of big corporations usually don't intervene on a personal level - that's why they have a collections department and credit manager to make those calls. I know anytime my customers write letters to my boss (the "President"), he turns around and gives me the letter and tells me to handle it. So not to dis-sway you, but the President might just refer you back to the Credit or Collections manager.

Yes the original location the payments went to was closed shortly after I started making payments again. The payments would eventually get to them once the post office forwarded them to their new address. Actually branches such as GMAC, FMC and Wachovia tend to move and /or close branches quite often. The vehicle was reposessed, but illegally as Wachovia already had 100% of the payments sitting on someone's desk before the repo guy stole it. They had to return the truck back to us, we had no fee's, we had to pay $0 as they illegally picked up the vehicle. From what I understand Wachovia has been in trouble for this very same thing. Our attorney is now working on this for us, he thinks he can get the truck back.

Ah I see - was it a Wachovia Dealer Services field office, or a branch of Wachovia Bank? The only reason I ask is because they technically are two different companies. So if it was a bank branch that closed, and the mail was being forwarded to the bank headquarters (who don't have access to Dealer Services computers), it naturally would take them a while to figure out the payment was for Dealer Services and pass it on to California where their main payment processing is.

Not that that's any consolation in your case. But my analogy would be if you were financing through Ford Motor Credit, and sending your payments to the Ford Assembly Plant where they actually make the cars. Forgive me for being blunt, but that's just not where they're supposed to go.

I only speak from personal experience in running a finance company. We've moved our corporate office several times over the years. But any loan documents, contracts, letters, payment coupons etc always list our PO Box to send payments and correspondence to -- which has not changed in the last 40 years. So when a customer tells me they mailed a payment to our old address, I have to ask "What prompted you to mail it there? No paperwork you have shows that address, and we never told you to mail it there." (In asking one guy, he said he put our name in his GPS and the GPS gave him that address - 4 years after we moved). Bottom line is that when a customer mails a payment to a different address than we instructed them to, we are not responsible if it doesn't get to us.

Now in our case, we make at least 100 phone calls (and mail out at least 5-10 past-due notices) to the customer before we repossess a vehicle. We even send a cure letter by certified mail, even though we don't legally have to. So we usually find out pretty quick if a customer is mailing payments to a bad address -- because they'll be calling to scream our ears off that they mailed a payment, and wanting to know why we keep calling?

Don't get me wrong, I'm not saying it's all your fault -- I'm just saying what my argument would be if this happened at my company. I don't know why Wachovia wouldn't have called you or sent any notices. I don't know what will come of the whole addressing/mail issue (ie will they use an argument similar to mine?)

I wish you luck, and hope your attorney can get it worked out for you. If you have any other questions, don't hesitate to ask away here.

But if you do get your car back, I'd suggest making payments online through their website, or else their mailing address for payments is:
PO BOX 25341
Santa Ana, CA 92799-5341

So say I owe $16,000 on a 2004 Chev Colorado pickup, low miles good shape. Can they accept a $5,000 bid on the vehicle and bill me the differance? Will Wachovia have to accept monthly payments on the differance?

1) They have to sell the vehicle on the fair market in a "commercially reasonable manner". Which means they cannot just sell it to the first person to walk in and offer $5K for it. Commercially reasonable usually means selling it the the highest bidder at a public or private sale auction. Public auctions are quite common, and rather self explanatory -- they put it on the auction block and people make bids -- winning bid takes the car. Private sale auctions entail the lender soliciting private parties to bid on the vehicle (usually they will get car dealer that they do business with to make bids). In a private auction, the final sale has to be evidenced by at least 3 bids.

In either case, if the the highest bid ends up being $5K, then that's what they sell it for. They apply proceeds from the sale (less towing expenses, vehicle conditioning, etc) to your account. Whatever is left (the deficiency balance) remains a legal debt due and owing. Under IL law, they are required to give you a final accounting of the balance (how much they sold it for, costs of repossession/towing/etc, credits for any unearned insurance/GAP/warranty premiums, if 78ths then a rebate for the unearned portion of the original finance charge).

2) Upon any occurance of default (which non-payment and repossession would count) there is an early termination of the contract, the loan accelerates, and any remaining balance becomes immediately due and payable. In other words, they do not have to accept partial payments in satisfaction - they can demand the entire balance be paid in full.

Now there is the issue of practicality. The reality is that most people won't be able to just up and pay the balance in full. So most lenders will take payments on the difference. They might weigh their options, though. For example, if your best offer is to pay them $50/month, and they know you make $6K/month and could get about $8-900/mo by garnishing your wages, then they may opt to file a lawsuit instead of accepting payments.

Hey make sure and double check on the repo laws in your state, wachovia has done the same thing to me, I am in Utah and the law is they have got to notify by mail before coming to reposses the car. I have taken my issue's with wachovia to small claims court and won cause they were a no show, now wachovia's trying to reset the case, I know this company is doing wrong and I will not let them get away with something that is there mistake. Don't give up and just brush it off thats why they bully people as they do.Good luck!