Many Pennsylvania residents may be surprised to learn that repossession of property is entirely legal under certain conditions. Even if the debtor faces financial difficulties, the creditor can assert its rights to payment. This could lead to a vehicle or another piece of property that hasn't been paid for being lawfully taken.
The right to repossession is triggered when a debtor becomes delinquent on a regularly scheduled payment. To be enforceable, a written security contract (payment agreement) must be signed by the debtor. It identifies the specific property that is the collateral for the debt. Once there is a delinquency, the creditor typically contacts a third party repossession agent to capture the property. Afterward, the property is usually sold to repay the debt and cover legal costs and fees.
If the property is a vehicle, there is no requirement of notice to be given to the consumer. If the property is something else, such as furniture or an appliance, written notice of 21 days must be given, in which time the consumer is permitted to bring the account current. It is important to note that the repossession agent must be able to capture the property without violating any laws, such as trespassing. Therefore, while a vehicle on a street or in a driveway can be repossessed, one in a garage may not be captured.
Although no court action is required to begin repossession, the consumer/debtor does have legal rights. A consumer law attorney can offer advice and counsel on repossession and other matters.