Car Repossession Laws in Pennsylvania

In Pennsylvania, the seller of a motor vehicle may repossess the vehicle if the person buying it is not making payments on the amount owed.

Pennsylvania’s repossession laws authorize an installment seller or title holder who has lawfully acquired a motor vehicle installment sale contract to retake possession of the vehicle if the buyer is in default of an amount due under the contract or has committed another breach, which the contract identifies as a ground for retaking the motor vehicle.

Unless the seller can retake the motor vehicle without a breach of the peace, they must do so by legal process. An entity other than the seller can repossess a car if the entity provided financing for the car. For example, a lender or creditor may retake a car if the buyer is in breach of the loan agreement.

The statute indicates that there is no specific time period when a car may be repossessed, in that the seller can retake it when the buyer is in default or breaches the contract.

The contract should specify the points at which the buyer would be in default, such as if they do not make a payment in full by the 15th of the month. The contract should state how many payments the buyer is able to miss before the seller can retake the car.

The owner of a car is not supposed to hide a car from repossession companies. Methods of hiding a car include locking it in a garage or behind a locked gate. The seller is not allowed to breach the peace or break the law by damaging the buyer’s property, to engage in a car repossession.

The seller may enter public property, such as a city street, or private property, such as the buyer’s driveway, to repossess the car.

A seller does not have to give a buyer a written notice of repossession before retaking the car, but must provide a notice of repossession immediately after the repossession. The seller is required to deliver the notice in person or send it by registered or certified mail to the last known address of the buyer.

In Pennsylvania, the notice of repossession must contain:

• Buyer’s right to reinstate the contract, if seller extends the privilege of reinstating the contract and redeeming the car.
• Itemized statement of the total amount necessary to redeem the car by reinstatement or payment of the contract in full.
• Notice to the buyer of the holder’s intent to resell the car after 15 days from the date of mailing the notice.
• Place where the car is stored.
• Name and address of the person to whom the buyer shall make payment or on whom the buyer may serve notice.
• Statement that any personal property left in the repossessed vehicle will be held for 30 days from the date of the mailing of the notice.
  
• Name and address of the person that the buyer may contact to receive a full statement of account.

When the seller retakes the vehicle, and the buyer does not pay to recover it, the seller can sell the car to another party at an auction or private sale. The seller must wait 15 days after mailing the notice of repossession to sell the car.

After the sale, the seller must tell the buyer what happened by sending a deficiency letter. This letter shows the amount remaining on the car loan, if any, and charges such as repossession and storage fees less the selling price of the car, as well as the total balance of the loan.

The buyer is still obligated to pay the total balance owed although they no longer own the car.

The legal process through which a seller or creditor retakes the car is called replevin. Replevin is defined as a civil action to recover goods that were unlawfully taken. Before starting a lawsuit for replevin, the seller is required to demand that the car be returned.

The seller typically must bring the lawsuit for replevin in the county where the car is located, usually in the Court of Common Pleas. After filing the lawsuit, the seller can request that the court issue a Writ of Seizure. The seller is required to post a bond with the court of double the value of the property. The court holds a hearing on the writ and issues a judgment on disposition of the property.

The court then holds a hearing on the trial. The trial may take place before a judge or jury. The seller must prove they have an ownership or security interest in the car and that they have the right to immediate possession of the car.

The seller must prove these matters by a preponderance of the evidence, or approximately 51 percent proof. The seller may also recover costs and damages associated with the replevin.

A buyer can get legal advice regarding auto repossession from a civil attorney who specializes in vehicle repossession. A buyer is not guaranteed a right to free legal counsel if they do not have the means to hire an attorney. The buyer can represent themselves in civil court.

During the 15-day period after the mailing of the notice of repossession, the buyer may redeem the car and terminate the installment sale contract. If the default at the time of repossession is 15 days or less, the buyer owes the sum of these charges, excluding the costs of retaking, repairing and storing the car and minus the rebate of any unearned finance charge:

• Unpaid time balance.
• Accrued late charges authorized by Pennsylvania statute.
• Other amounts lawfully due under the contract.

If the default at the time of repossession is more than 15 days, the buyer owes the sum of:

• Unpaid time balance.
• Accrued late charges authorized by Pennsylvania statute.
• Costs of retaking, repairing and storing the car.
  
• Other amounts lawfully due under the contract.

The amount due is less the rebate of any unearned finance charge. If the buyer is able to pay the seller the money necessary to redeem the car, the seller must return the repossessed car as soon as is reasonably possible, but not later than 10 business days from the receipt of the funds.