As either a lender or debtor, it is imperative that you are informed about your rights and privileges in preserving the right to your property. Property can be subject to replevin or repossession when the debtor defaults, or fails to pay, under a contract. The creditor can then sell the property to a third party or financial institution which may, but does not always, settle the debtor’s debt. If the sale of the property does not settle the debt, the debtor may be required to pay the remaining balance, or the deficiency. Both replevin and repossession face certain challenges such as being time consuming, costly, and posing the risk of damaging your property. Additionally, laws related to replevin and repossession vary by state, so it is essential that you abide by your state’s laws. Lastly, certain instances of default can possess the possibility of mediation or negotiation as a cheaper alternative to the traditional court dispute.
What is Replevin?
Replevin is a legal action to secure possession of personal property such as cars, boats, and artworks. Replevin even applies to intellectual property such as electronic data. Replevin requires a formal court order demanding the consumer to return the property to the owner. Additionally, replevin requires a right to written notice of the creditor’s intent to seek replevin and a right to be heard before the order is issued by the court. All that is needed to seek an order for replevin in Florida is a writ of replevin, filing fee, and security bond.
Some challenges to keep in mind about replevin include establishing proof of ownership, posting bond, and assuming the risks of pre-judgment replevin for debtors. Additionally, filing a lawsuit for replevin poses the risk of a complicated countersuit claiming the right to the property.
As a lender, hiring a licensed attorney when seeking replevin is beneficial to navigate the legal landscape, build a strong case, appear in court, and negotiate a fair and speedy return of your property.
What is Repossession?
Repossession is an authorized way for creditors to take back collateral without a court order when a debtor “fails to make a payment on the loan within 30 days after the end of the loan’s maturity date or any extension of such date, whichever is later.” Fla. Stat. § 537.012(1). This process is less formal than replevin and varies by jurisdiction.
Additionally, repossession requires an obligation for the repossessing agent to not breach or disturb the peace. For example, a licensed repossession agent cannot enter a locked garage or gate to repossess a car without permission.
Repossession faces its own unique risks and challenges as well. In addition to a breach of peace, such challenges include improper notice, wrongful repossession, and a deficiency judgment even after repossession.
If you believe that your rights have been violated in an attempted repossession, contact one of our experienced attorneys today to let us help you protect your property.
What is the difference between Replevin v. Repossession?
Replevin and repossession are actions for creditors/lenders to be made whole in the event of a default. However, replevin is used for personal property while repossession attempts to pay off a loan by taking the debtor’s asset(s). Additionally, replevin requires a court order and notice while repossession does not involve the court. Acts of replevin apply to more common individuals, such as an ex-roommate who took your furniture, while repossession is unique to creditors.
If you’re left wondering which form of action is right for you, contact one of our experienced attorneys today for a free consultation.
