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 Posted: Sun Jul 27, 2008 9:28 pm Subject: Can unsecured creditor can garnish my car with no equity? |
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I have a car which automobile loan company made a collateral when I purchsed. I have been paying monthly payment on time so far and I will be able to continue to pay. I still owe $15,000 to this automobile loan company, but current actual value of this car is $12,000 according to market research. Therefore, my car has no equity, but minus value.
Meantime,I have unsecured debt amounting to $30,000 from credit card company.
One of credit card company sued me and it is going to get court order to garnish my assets. However, I have no asset exscept this car.
In such a case, unsecured creditors can garnish my car with an cort order?
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boldotousan
Joined: 27 Jul 2008
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NASCAR_Devil
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| Posted: Mon Jul 28, 2008 8:14 pm Subject: |
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The lender financing the car has primary rights in and to the vehicle by virtue of a purchase money security interest created when you first bought the car. They can repo under any circumstance (ie no equity) because they have the title.
The credit card can't just take your car because they got a judgment. They would have to go back through court and try to file an attachment on the vehicle, if they want to go through that trouble. Their lien would always be subordinate to the finance company until the car's paid off. Then, they may be able to execute their attachment. But you also have certain exemptions depending on your state, and the vehicle may be exempt from attachment under your state law.
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DebtCruncher
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