Facing financial difficulties with your car loan from Westlake Financial? One of the biggest worries for car owners in this situation is: when will Westlake Financial repo your car? It’s a stressful question, and understanding your rights and Westlake’s repossession process is crucial. This guide from Car Repair Online will break down everything you need to know about Westlake Financial repossession, helping you navigate this challenging situation and explore your options.
Understanding Westlake Financial and Vehicle Repossession
To understand when Westlake Financial might repossess your car, it’s important to first know who they are and how they operate in the auto finance world.
Westlake Financial Services, officially Westlake Services, LLC, is a major auto finance company based in Los Angeles, California. They are known as a subprime lender, meaning they specialize in providing car loans to individuals with lower credit scores and less-than-perfect credit histories. They work with a vast network of dealerships across the United States, offering financing for both new and used vehicles. Being privately held and part of the Hankey Group, Westlake Financial positions itself as a significant player in the auto finance industry.
A photo of Ian Anderson, Group President, highlighting a key executive at Westlake Financial.
Subprime loans, by their nature, come with higher interest rates. This is because lenders like Westlake Financial take on more risk when lending to borrowers with lower credit scores, who are statistically more likely to default on their loans. If you have a subprime loan with Westlake Financial, understanding the terms of your loan agreement and the potential consequences of missed payments is vital.
The Repossession Question: How Soon Can Westlake Financial Repo Your Car?
The critical question for many borrowers facing financial strain is: how many missed payments before Westlake Financial repossesses my car? Unfortunately, there’s no specific grace period mandated by law that dictates exactly when Westlake Financial will repo your car. Legally, Westlake Financial can repossess your vehicle as soon as you default on your loan, which, according to most loan agreements, can be just one missed payment.
While it might seem harsh, the loan agreement you signed likely outlines the terms of default and repossession. Lenders like Westlake Financial have the legal right to repossess the vehicle that secures the loan if the borrower fails to uphold their end of the agreement by making timely payments.
In reality, the exact timing can vary. While Westlake can technically repossess after a single missed payment, they might not always do so immediately. However, it is extremely risky to assume there’s a grace period. Falling behind on payments should be taken very seriously, and proactive communication with Westlake Financial is crucial.
Consider the case of Rashana Williams in Tampa, Florida, mentioned in the original article. Her car was repossessed, highlighting the swift action lenders can take, even if mistakes are made. While Westlake Financial later claimed it was a mistake in Ms. Williams’ case, it underscores the potential for rapid repossession action.
A professional headshot of John Schwartz, Senior Legal Analyst, representing Westlake Financial’s legal department.
Understanding “Commercially Reasonable” Repossession
While Westlake Financial has the right to repossess your car upon default, the repossession and sale process must be “commercially reasonable” under the Uniform Commercial Code (UCC). This legal framework aims to ensure fairness in how lenders handle repossessions and the subsequent sale of the vehicle.
Key aspects of a commercially reasonable repossession and sale include:
- Notice of Intent to Sell: Westlake Financial is legally required to provide you with notice of their intent to sell your repossessed vehicle. This notice must be sent to you at least 10 days before the sale and must contain specific information about the sale, including whether it will be public or private.
- Maximizing Sale Value: Westlake Financial has a responsibility to try and maximize the sale price of the repossessed vehicle. This means they must take reasonable steps to ensure the sale is conducted in a way that attracts potential buyers and achieves a fair market value. While private sales are permitted, public auctions are often viewed as more transparent and likely to yield a commercially reasonable price.
- Applying Proceeds to Debt: After the vehicle is sold, Westlake Financial will use the proceeds to cover the costs of the repossession and sale, and then to pay off your outstanding loan balance. Any remaining funds after these deductions should, in theory, be returned to you. However, it’s more common that the sale price is less than the outstanding loan balance, leading to a deficiency balance.
If you believe Westlake Financial did not conduct the repossession or sale in a commercially reasonable manner, this could be a potential defense against a deficiency lawsuit if they try to recover the remaining balance of the loan after the sale.
Defending Against a Westlake Financial Deficiency Lawsuit
After Westlake Financial repossesses and sells your car, and if the sale price doesn’t cover the full loan amount, you may be sued for the deficiency balance. However, you have rights and potential defenses.
Common defenses against a Westlake Financial deficiency lawsuit include:
- Commercially Unreasonable Repossession or Sale: As mentioned, if Westlake Financial failed to follow commercially reasonable procedures during the repossession or sale, this can be a strong defense. For example, if they didn’t provide proper notice, or if the sale was conducted improperly and resulted in a significantly low sale price.
- Holder in Due Course Rule: This rule, particularly relevant in auto loans, protects consumers from certain lender practices. If the original car dealership engaged in fraud or misrepresentation when selling you the car, you may be able to raise these issues as defenses against Westlake Financial, especially if your loan contract includes a specific “Holder in Due Course” notice. The case of Danielle Gump, who purchased a defective car, illustrates how this rule can be applied against Westlake Financial.
A professional portrait of James Randolph Liebler II, legal counsel involved in cases related to Westlake Financial.
- Statute of Limitations: There’s a time limit on how long Westlake Financial can sue you to recover a deficiency balance. In Florida, like many states, the statute of limitations for breach of a written contract is typically five years. If the lawsuit is filed after this period, it may be dismissed.
It’s crucial to remember that legal defenses can be complex and fact-specific. If you are facing a deficiency lawsuit from Westlake Financial, seeking legal advice from an attorney experienced in consumer rights and auto loan law is highly recommended.
Westlake Financial: Past Legal and Regulatory Issues
It’s also informative to be aware of Westlake Financial’s history with regulatory bodies and legal actions. This can provide context to their business practices and approach to collections and repossessions.
- Department of Justice Lawsuit (Servicemembers Civil Relief Act – SCRA): The Department of Justice has previously sued Westlake Financial for violating the Servicemembers Civil Relief Act (SCRA). This act protects military service members from certain civil liabilities while on active duty. The DOJ found that Westlake Financial unlawfully repossessed vehicles from service members protected by the SCRA. This resulted in a settlement requiring Westlake to pay compensation to affected service members and civil penalties.
- Consumer Financial Protection Bureau (CFPB) Action: The CFPB has also taken action against Westlake Financial for deceptive debt collection practices. The CFPB found that Westlake Financial used deceptive tactics, including impersonating other entities to trick borrowers into providing information or making payments. The CFPB order required Westlake Financial to pay significant redress to consumers and civil penalties, and to change their debt collection practices.
These past legal and regulatory issues highlight the importance of understanding your rights and ensuring that Westlake Financial adheres to fair and legal practices in all their dealings with borrowers, including repossession.
FAQ: When Will Westlake Financial Repo My Car?
To summarize and directly answer the key question:
Q: How many missed payments before Westlake Financial repossesses my car?
A: Legally, Westlake Financial can repossess your car after just one missed payment. While the exact timing can vary, there’s no guaranteed grace period. It is critical to contact Westlake Financial immediately if you are facing payment difficulties to explore your options and avoid repossession. Do not assume you have time before repossession occurs.
Q: What should I do if I’m worried about Westlake Financial repossessing my car?
A:
- Communicate with Westlake Financial: Contact them as soon as you anticipate or experience payment difficulties. Open communication is key.
- Understand Your Loan Agreement: Review your loan documents to understand the terms of default and repossession.
- Explore Options: Discuss potential options with Westlake Financial, such as:
- Catching up on payments: If possible, prioritize getting current on your loan.
- Loan Modification or Refinancing: Explore if you can modify your loan terms or refinance to a more affordable payment.
- Voluntary Surrender: While not ideal, voluntarily surrendering the vehicle might be a less damaging option than repossession in some cases.
- Know Your Rights: Familiarize yourself with your rights regarding repossession and debt collection.
- Seek Legal Advice: If you are facing repossession or a deficiency lawsuit, consult with a consumer rights attorney.
Conclusion: Proactive Steps to Avoid Repossession
The answer to “when will Westlake Financial repo your car?” is sooner than you might think. Proactive communication, understanding your loan agreement, and knowing your rights are your best defenses against vehicle repossession. If you are struggling with your Westlake Financial auto loan, take action immediately to explore your options and protect your vehicle and your financial well-being. Remember, seeking professional financial or legal advice can be invaluable in navigating these challenging situations.
