Author Topic: Avoiding repossesion  (Read 6443 times)

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Love3angle

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Avoiding repossesion
« on: December 28, 2006 06:05:09 PM »
My DH is being sued by a JDB and we have a financed car in both our names with only 4 payments left on it. We're in California. If we pay off the car and transfer the title into my name only, will that keep it from being seized, or do you have a better suggestion? I can't seem to locate info on if/how our marriage attaches his debts to me or if bank accounts and titles in my name only can protect our assets?

Rottweiler

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Re: Avoiding repossesion
« Reply #1 on: December 28, 2006 07:57:12 PM »
Since suit has already been filed, any move you make to try to retitle the car (or transfer any asset) to your name only may well be considered "in fraud of creditors" if the JDB wins the case and gets the judgment and it's upheld.  It would be clear that the move was to try to keep assets from being replevined because of the timing, and therefore the court could reverse it and then the asset becomes available to satisfy the debt.  You should, instead, check the judgment exemptions in CA to assess the chances of this happening in the worst-case scenario:  The car's asset (Blue Book) value may well, even if the title is then free and clear, be too low for the car to be vunerable to seizure (the car may well be exempt) to satisfy a judgment,  either as an exemption under the law or because the cost/recovery ratio would be unfavorable to a judgment creditor.
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Love3angle

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Re: Avoiding repossesion
« Reply #2 on: December 28, 2006 11:03:44 PM »
Hmmmm, after paying off the title holder and assuming they'd get less than Private Party value on kbb, it would probably only cover less than half the alleged debt, assuming they get a judgement for the full amount they claim. Would that be worth it to them?

It looks like in CA cars are not exempt from judgement, even if it is my primary vehicle. It also looks like they can try and garnish my wages even though I am not a defendant because I'm his spouse, though all the info I've found so far is for small claims court and this isn't files in small claims.

Sheesh, this is such a pain to weed through!  :-\

Rottweiler

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Re: Avoiding repossesion
« Reply #3 on: December 29, 2006 02:06:43 AM »
The law pertaining to judgment exemptions is the same for all courts; the Small Claims court would just put it in an easy-to-understand format.

Items taken in replevin (seized to pay a judgment) are normally sold at a Sheriff's auction.  Those do not happen every day, and cars sold at auction typically sell for far less than even the "book" value.  Add in the costs of storing the car until it is auctioned off, plus the costs of the seizure process (similar to a repo.), the Sheriff's fees, and the auction costs?  The judgment creditor won't get all that much, and may actually lose on the deal.  So unless the car were a really high-value vehicle I would not worry TOO much about this.

I would worry more about a wage garnishment, which it appears you may well face.  You need to look up the laws pertaining to this in CA as well as the Federal exemptions, which will limit what can be taken out of your pay.  If you don't make much, you might get lucky and would not have much, if anything, taken out should the worst happen.  Even if you make a lot, there are limits, though with DH unemployed you probably could not afford the loss.  Also you need to check to see if they could garnish any unemployment check or separation pay he might be getting.  (I do not believe UC is exempt.)  They could hit him there.

Also, did you read this thread?  http://debtorboards.com/index.php?topic=14.0  That is even more important...protecting the bank account is crucial (bank executions are the second favorite judgment collection method).
« Last Edit: May 05, 2010 02:47:36 AM by Flyingifr »
“This is a court of law, young man, not a court of justice."
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