Indiana Repossession Law

August 24, 2022

The Indiana repossession law can help you protect your car from being repossessed.  You can legally protect your vehicle, keeping you and your car on the road.   It is also important to know the repossession laws well enough to even get your vehicle back in Indiana in the event it actually does get repossessed.

Indiana Repossession Law – When Can Your Car be Repossessed in Indiana?

In Indiana, your car can be repossessed even for the smallest “default” on your loan.   This means that your car could even be repossessed in some situations even if your payment is even a single day late.   Look at your contract to see what constitutes a “default.”   More than likely, this is simply a late or “delinquent” payment.   That means any time after your payments are “late,” your car could theoretically be repossessed.

In reality, however, it is very rare for a car to be repossessed unless it is 2-3 months or more behind in payments.   Generally, creditors are in the lending business, not the repossession business.   Repossession is a last resort for most creditors.   Be careful, however, some businesses such as “buy-here-pay-here’s” (especially those who install car trackers) are more likely to repossess in much less time.   Also, if you have been late in the past, you could be more likely to have an accelerated repossession the next time you get behind.

Also, filing a Chapter 7 or Chapter 13 bankruptcy will stop your car from being repossessed.  Chapter 7 only delays repossession for about 4-5 months (or sometimes less).   Chapter 13 can permanently stop repossession and set up a new payment on the vehicle.   This new Chapter 13 payment for the vehicle can sometimes be less than the payment you were required to pay beforehand.

Can I Get My Car Back After Repossession?

Yes, you can generally always get your car back in Indiana after repossession.   You will need to do it very quickly, however.  Most repossessions in Indiana are sold at auction after about 2 weeks.   After the car is sold at auction, you cannot get the vehicle back.

You will need to contact your creditor to get the vehicle back.  The creditor will also inform you as to what company repossessed your vehicle.   Your creditor and the repossession company will instruct you on what is required to get your vehicle back.

You can get your vehicle back in Indiana in 3 ways.  First, you usually are allowed to “reinstate” the loan by just paying all repossession fees and bringing your payments back up to date.  This may sometimes take $1000-$2000 or more.  It can be expensive, but manageable for many people.

Second, you may be able to get the vehicle back by paying off the entire loan.   Sometimes this may be your only option, depending on the circumstances or the contract.

Third, you may be able to get your vehicle back by quickly filing for Chapter 13 bankruptcy.   A Chapter 13 bankruptcy usually requires the car creditor to return the car back to you in Indiana.  Then, you can just pay your newly restructured payments to the Chapter 13 Trustee instead of directly to the creditor.  Getting the vehicle back works on most Chapter 13 cases if you file the case very quickly.   Chapter 13 usually costs at least $313 to get started.   The first payment for the newly structured payments starts about a month after the case is filed.

Can You Legally “Hide” Your Car?

This is a hard question to answer.   If you “hide” your car, you are probably in violation of your contract.  It could later be considered you are intentionally harming the collateral or even committing fraud.  However, it is extremely rare that a collection court or prosecutor acts on such things.  Your “hiding” actions would probably have to be very extreme or long-term to be considered into such categories.

Most people instead just lock up a vehicle in a garage or temporarily move the vehicle to a new location.   This is usually acceptable to some degree by the law.  Usually, if the creditor has too much trouble getting the vehicle back in Indiana, they will simply seek a court order.   This is called a “Replevin Action” in Indiana where the law allows a return of property “wrongfully taken or wrongfully detained.”  You will be in clear, direct violation of the law (court order) when a replevin order is granted if you then delay returning the vehicle.

Be careful, however, because the creditor can then come after you also for the costs of the delay and the “replevin action.”  Also, if you are sufficiently rough or rude with a creditor’s agent, you could even face criminal action.  Physically delaying a repossession is generally a very bad idea for a variety of reasons that cannot fully be addressed in this short, Indiana legal overview.   Remember, you would then be in violation of the terms of your contract.

Can My Garage be Broken into or Locks Forced?

Indiana Repossession Law - Can You hide your car in the garageA creditor’s agent can never break into your garage or force a lock to repossess a vehicle in Indiana.   This is completely illegal.   The creditor must seek a replevin action and get the court order.

However, our office has heard of garages being forced more than once.  Smaller creditors sometimes do not understand why they cannot just come to get the car back even behind a locked garage.   It is generally just advisable to never escalate a situation.   Remember, if your car is behind a locked garage that you refuse to open, you are likely escalating the situation.  A court will look at it as if you are also at fault for not following your agreed contract.

Can I Get Back My Belongings I Left in My Car in Indiana?

Yes, you are entitled to have the belongings you left in your car returned to you in Indiana.   However, it is acceptable in this Indiana for the creditor to charge you a reasonable fee for this service and the communication involved.  If you have sentimental or valuable belongings that were left in the car, it is probably worth your time and money in Indiana for them to be returned.   Low-value items are probably not worth the effort or cost involved.

Need to stop car repossession?  Find out more details on how to stop a car from being repossessed here.





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