Your Guide to Virginia's Repossession Laws

It’s very easy to find yourself behind on your auto payments. Either because your budget wouldn’t stretch or you simply forgot to make a payment, falling behind on auto debt is understandable. But if your lender isn’t understanding, they may choose to repossess your car or truck. When you take out an auto loan, your new vehicle serves as the collateral that secures that loan. If you default on the loan, the lender can repossess the car, which means they take back the car or truck that secured the loan.

Virginia law governs borrowers’ and creditors’ rights and responsibilities during the repossession process. Read on to learn more about how the repossession process plays out in Virginia. If you’re at risk of repossession or your vehicle has already been taken, this guide will help you to understand your options.

How Many Payments Can I Miss Without Risking a Repossession in Virginia? 

The terms of car loan contracts vary. Your contract may specify that your vehicle can’t be repossessed until you are, for example, 90 days delinquent on your account. If your contract doesn’t include a provision like this, your lender can begin the repossession process if you’re even a single day late on one payment.

Most lenders won’t classify loans as in default until they’re at least 90 days past due because the repossession process is costly. But it’s a good bet that your auto lenders will seize the car (the collateral securing your loan) if you’re months behind on your payments.

Will I Be Notified Before the Repossession? How?

Virginia lenders are required to honor a prior notice requirement. This means that lenders can’t repossess your vehicle unless they’ve told you — at least 10 days in advance — in writing, that your payments are past due.

Lenders must also clearly indicate that if you don’t bring your overdue balance current within 10 days (or more, if the lender grants you more time) that your vehicle may be repossessed. If the lender doesn’t send this notice, they can’t collect any costs associated with repossession or sale of the vehicle.

If you don’t pay your overdue balance or make alternative arrangements with your lender after receiving this notice, your lender doesn’t have to call you or otherwise tell you that plan to take your car. You may simply step out onto your driveway one day and discover that it’s gone.

This is one reason it’s important to be proactive in communicating with your lender if you’re at risk of missing a payment or you’ve already missed one.  

How Can I Prevent a Repossession?

Many lenders are willing to work with borrowers who are either at risk of missing a payment or have only missed one or two. If you’re proactive in reaching out to your lender, you may be able to skip a payment, defer your account so that you pay less for a month or two, tack on your missed payment to the end of your loan cycle, or even renegotiate the terms of your contract.

Alternatively, you could potentially refinance your car loan. This would allow you to fully pay off the loan with your current lender, and get a different loan with new loan terms.

With that said, the only way to prevent an auto repossession for sure, is to pay off your overdue balance before your lender accelerates your loan.

Most of the time, this means paying off your overdue balance before the 10-day period detailed in a written notice has expired. For others, it means embracing the process of voluntary repossession, which allows you to surrender your vehicle before it’s formally seized.

Voluntary repossession may be a good option for you if your auto loan is already upside down and you won’t be able to manage your loan payments anytime soon.  

What Can Repo Companies in Virginia Do? 

The state of Virginia doesn’t require repo companies to be licensed. So, it can be hard to tell whether a repo man is acting legitimately when they’re repossessing your vehicle. Do not attempt to make a repossession agent — even one who seems shady or otherwise illegitimate — leave by force, as you may be held legally responsible for use of force.

Instead, if a repossession service company tries to trick you, mislead you, get you to hand over your property by force, or use other unlawful repossession tactics, you’ll want to speak to a lawyer about your options.

Virginia repossession companies aren’t required to notify you before they seize your vehicle. They may take your car or truck from virtually anywhere it’s parked that isn’t locked. If you keep your vehicle in a locked garage, they’ll need to get a court order to retrieve it.

What About the Personal Property in My Car? 

Under Virginia law, “Borrowers shall be permitted to recover personal items from repossessed motor vehicles promptly and at no cost.”

This means that a repossession service company should allow you to retrieve your personal belongings either before they take your vehicle (if you see them preparing to seize it) or after you’ve contacted them following a successful repossession. They aren’t allowed to charge you for the return of your personal property.

Note that you’re only entitled to property that isn’t attached to the car. For example, you can retrieve your child’s car seat and the contents from your glove compartment. But you can’t take an upgraded stereo system installed in the vehicle that can’t be removed without tools.

What Happens After a Repossession in Virginia? 

Once a repossessor seizes your car or truck, you’ll be given the option to pay the balance you owe in full. This is called redeeming the vehicle. If you don’t redeem your vehicle or enter into an alternative repayment arrangement with your lender, your lender will sell your vehicle at auction. 

Virginia law requires lenders to give a minimum 15-day notice to borrowers whose vehicles will be sold. In this written notice, the lender must indicate the date and time of the sale and the total amount you must pay to redeem the vehicle. Once your vehicle is sold, the certificate of title will no longer be in your name.

Do I Still Owe After a Repossession in Virginia? 

Your auto loan debt doesn’t disappear once your lender seizes your vehicle. You’re still responsible for the debt you owe. If your car is sold at auction, the proceeds of that sale will be applied to your total balance owed. This includes the loan amount plus fees.

If the vehicle sells at a profit, Virginia law mandates that the surplus be returned to you. If the proceeds of the sale don’t cover the total balance you owe, you’ll have to pay the remainder. This is known as a deficiency balance.

Make sure to repay your deficiency balance either as a lump sum or through an installment agreement you work out with your lender. If you fail to pay this amount, the lender may seek a deficiency judgment against you in court. This will hurt your credit score and may result in wage garnishment.

Can I Get My Car Back After a Repossession in Virginia? 

If your car has already been seized by a repo agent, Virginia law allows you to redeem it by paying off the full balance that you owe. This balance will likely include the total amount of the loan, repossession fees, late fees, and other kinds of fees. You are permitted to redeem your car up until the time that it’s sold at auction.

It may also be possible to work out an alternative repayment arrangement with your lender. You may be able to renegotiate the terms of your loan or reenter your existing loan after paying your overdue balance plus any repossession fees you owe. Although some lenders are hesitant to work with borrowers whose vehicles have already been repossessed, others are more flexible. Exploring your options may be worth a try if you want to hang on to your vehicle.

Where Can I Find More Information About Repossession Laws in Virginia? 

If you want legal advice on how to deal with the risk of vehicle repossession or how to respond to a car repossession that’s already occurred, you can speak with an attorney or consult a local legal aid service office. Virginia has nine legal aid programs.

Visit VALegalAid.org to connect with a representative from the Virginia Poverty Law Center. They can help you to determine where your local legal aid service center is located and whether you’re eligible for free or low-cost legal services.