It’s a question that weighs heavily on the minds of many car owners financed through Westlake Financial Services: When will Westlake Financial repo your car? If you’re struggling to keep up with your auto loan payments, especially with a subprime lender like Westlake, understanding their repossession practices is crucial. The reality is, the repossession timeline can be surprisingly swift, and knowing your rights and options is your first line of defense.
Understanding Westlake Financial Services and Their Repossession Practices
Westlake Financial Services, officially Westlake Services, LLC, is a major player in the auto finance industry, particularly known for specializing in subprime and near-subprime auto loans. Based in Los Angeles, California, they operate through a vast network of over 50,000 dealerships across the United States. As a privately held company under the Hankey Group umbrella, Westlake Financial claims to be the “largest privately held finance company” in the nation. This scale means they handle a significant volume of auto loans, many of which are to individuals with less-than-perfect credit.
What does “subprime lender” mean for you? It signifies that Westlake Financial caters to borrowers with lower credit scores, often below 600. While this can be a lifeline for those who might be denied loans elsewhere, subprime loans come with higher interest rates to compensate for the increased risk of default. These elevated rates can make it more challenging to manage payments and increase the risk of falling behind, ultimately leading to repossession.
Westlake Financial’s business model inherently involves a higher risk of repossession compared to lenders dealing with prime borrowers. Their focus on subprime loans means they are more likely to encounter customers facing financial hardship, increasing the potential for payment defaults and subsequent repossessions.
Does Westlake Financial Repossess Vehicles? The Short Answer is Yes, and Quickly.
Yes, Westlake Financial is known to repossess vehicles, and they can initiate this process relatively quickly, sometimes even after just one missed payment. While some lenders might offer a grace period, with subprime loans, the terms are often stricter. The loan agreement you signed with Westlake Financial outlines the conditions under which they can repossess your car, and missing a payment is almost certainly listed as a trigger.
The case of Rashana Williams from Tampa, Florida, illustrates how swiftly and sometimes mistakenly repossession can occur. Ms. Williams, who owned her car outright, had her vehicle wrongfully repossessed, allegedly at the behest of Westlake Financial, due to an error. Despite her vehicle being owned free and clear, it was towed, causing her significant distress and expense. While Westlake Financial later claimed it was a mistake, this case highlights the aggressive nature of repossession practices and the potential for errors within the system.
This example underscores a critical point: You don’t have to be significantly behind on payments for Westlake Financial to consider repossession. Even a single missed payment can technically put you in default and initiate the repossession process. While the exact timing can vary, it’s unwise to assume you have a large buffer after missing a payment before repossession becomes a real threat.
Understanding Your Rights and Westlake’s Repossession Process
While Westlake Financial has the right to repossess your vehicle if you default on your loan, they must still adhere to legal procedures. Repossession laws vary by state, but generally, Westlake Financial (or their agents, like towing companies) can repossess your car without prior notice in many jurisdictions. This is known as “self-help repossession,” meaning they don’t need to go to court to get permission first.
However, even with self-help repossession, Westlake Financial cannot breach the peace. This means they cannot:
- Break into a locked garage to seize the vehicle.
- Physically threaten or harm you during the repossession.
- Cause property damage while taking the car.
If a repossession agent breaches the peace, it could be considered an illegal repossession, giving you grounds to challenge the action.
After repossession, Westlake Financial is typically required to send you a notice of intent to sell your vehicle. This notice should inform you:
- That your car has been repossessed.
- How you can redeem your vehicle (pay the full loan amount plus repossession costs).
- The details of the public or private sale of the vehicle.
- That you will be liable for any deficiency balance if the sale price doesn’t cover the outstanding loan and repossession expenses.
Westlake Financial is legally obligated to sell your repossessed vehicle in a “commercially reasonable manner.” This is a crucial point, as it impacts how much they can claim you owe in a deficiency balance.
Defending Against a Deficiency Lawsuit from Westlake Financial
If Westlake Financial sells your repossessed car and the sale price is less than what you still owe on the loan plus the costs of repossession and sale, you will be left with a deficiency balance. Westlake Financial may then pursue you to recover this balance, potentially through a lawsuit. However, you have defenses against such lawsuits.
1. Commercially Reasonable Sale: You can challenge whether Westlake Financial sold your vehicle in a commercially reasonable manner. If the sale was not conducted properly (e.g., sold for far below market value, inadequate advertising of the sale), you can argue that the deficiency balance should be reduced or eliminated. Courts will scrutinize private sales more heavily than public auctions in determining commercial reasonableness.
2. Holder in Due Course Rule: This rule protects consumers from being held liable for the full loan amount if the dealership engaged in fraud or misrepresentation during the car sale. If the original dealer deceived you, and Westlake Financial is considered a “holder” of your loan contract, you can raise those dealer-related defenses against Westlake. The loan contract should contain a “Holder in Due Course” notice that preserves your rights. In the case of Danielle Gump in Florida, she successfully used this defense against Westlake Financial due to issues with the car she purchased from the dealer.
3. Statute of Limitations: There are time limits for debt collection lawsuits. The statute of limitations for breach of written contract in Florida (and many other states) is typically five years. If Westlake Financial waits longer than this period to sue you for a deficiency, the lawsuit may be time-barred.
4. Wrongful Repossession: As seen in the Rashana Williams case, wrongful repossessions do happen. If your car was repossessed in error (e.g., you were not in default, the car was not actually collateral), you have grounds to sue for damages.
5. Service Members Civil Relief Act (SCRA) Violations: Westlake Financial has faced legal action from the Department of Justice for violating the SCRA, which protects active-duty service members from certain civil liabilities, including wrongful repossession. If you are a service member and believe Westlake Financial violated your SCRA rights, you should seek legal counsel immediately.
Westlake Financial’s History of Regulatory Issues: CFPB and DOJ Actions
Westlake Financial has a history of regulatory scrutiny regarding their debt collection and lending practices.
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Department of Justice Lawsuit: The DOJ has sued Westlake Financial for violating the Service Members Civil Relief Act by unlawfully repossessing vehicles from protected service members. This resulted in Westlake paying significant compensation and penalties. This demonstrates a past pattern of potentially aggressive or improper repossession practices.
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CFPB Consent Order: The Consumer Financial Protection Bureau (CFPB) has also taken action against Westlake Financial for deceptive debt collection practices. The CFPB found that Westlake Financial used deceptive tactics to trick borrowers into answering calls and disclosing vehicle locations. They also falsely threatened criminal prosecution and misrepresented borrowers’ rights. The CFPB order required Westlake to pay substantial redress to consumers and penalties.
These regulatory actions highlight a pattern of potentially problematic behavior by Westlake Financial and underscore the importance of knowing your rights and being vigilant when dealing with them.
Frequently Asked Questions About Westlake Financial Repossession
Q: After how many missed payments will Westlake wait before ordering a repossession of the vehicle?
A: There is no set waiting period. Westlake Financial can legally order repossession after just one missed payment. While they might wait longer, you should not count on it. Defaulting on even a single payment puts you at risk of repossession.
Q: Is Westlake responsible for the actions of the towing company they hire for repossession?
A: Yes. Under laws like Florida Statute Section 679.503, Westlake Financial is responsible for ensuring that repossession agents do not breach the peace during a repossession. If the towing company acts illegally or breaches the peace, Westlake Financial can be held liable.
Conclusion: Act Proactively to Avoid Westlake Financial Repossession
Understanding when Westlake Financial can repo your car is the first step in protecting yourself. The answer is: potentially very quickly, even after one missed payment. If you are facing financial difficulties and struggling to make your car payments to Westlake Financial, it is crucial to:
- Communicate with Westlake Financial: Reach out to them immediately to discuss your situation and explore options like payment arrangements or loan modifications.
- Review Your Loan Agreement: Understand the specific terms of your loan and what constitutes default.
- Know Your Rights: Familiarize yourself with your state’s repossession laws and your rights as a borrower.
- Seek Legal Advice: If you are facing repossession or have had your car repossessed, consult with a consumer rights attorney to understand your options and protect your interests.
Proactive communication and understanding your rights are your best defenses against the stress and financial hardship of auto repossession by Westlake Financial.
