On your own letterhead, write or print a notice that includes the delinquent customer’s name, address, and phone number. Explain that you have tried to contact them without success. Notify that they must contact you to reach a resolution of your pending payments.

List the vehicle in question along with its VIN number.

Provide a final date for the due date of all past due payments (labeled “last payment date”) and the amount due to catch up (labeled “amount due now”). Explain that:

“If you pay the amount due now before the last payment date, you may continue with the contract as if you were not delinquent. If you do not pay by that date, we may exercise our rights under the law, including the involuntary repossession of the vehicle. in which we have a security interest”.

Remember that as time passes until the due date you assign, more past due payments may accumulate. Include in the letter that by the due date these payments will also be due and list each payment by amount and normal scheduled due date, ie “Due Date_______ Amount _______”

After listing these payments that will accrue by the final due date, explain that:

“To fully cure your account, and to avoid exercising our legal rights under the law, the payment or payments listed above must ALSO be paid in full on or before the last payment due date”

Let them know that even if the account is brought current, they still have the right to take action if payments are late again within a designated period of time:

“If you are again late within the next ____ weeks in making your payments, we may exercise our rights, including recovery, without sending you another such notice.”

Explain your rights to collect more money owed under the surety bond:

“Rights we may exercise under the law include repossession of the motor vehicle securing this debt. If the motor vehicle is repossessed, either voluntarily or involuntarily, it may be sold and you may owe the difference between the net proceeds of the sale and the remaining balance due under the contract”.

Ask the customer to contact you right away if they have any questions.

Close the letter with:

“If we do not hear from you within___days, we will have no choice but to issue an ORDER TO REPOSSESS the vehicle.”

Sign it and have it notarized.

Send the certified letter with the delivery confirmation and the requested return address. This way, you have 2 ways to confirm and prove that they received the notice in case legal issues arise after the recovery.

You also get any forwarding addresses if the customer has moved so you can more easily locate the vehicle. The requested return address will send the letter back to you if they moved instead of forwarding it to them.

If payment has not been made and you are ready to repossess the vehicle, you must write or type an ORDER TO REPOSSESS. This will indicate the following:

recovery order

Buyer:

[Name]

[Address]

[Phone number]

breach of contract

[vehicle year, make, model, VIN]

Net Pay Balance: [Total bottom line balance owed]

Repo Fee: [$ amount of the repo fee you charge]

Storage fee: [$ amount of the storage fee you charge]

Damage: [$ amount of any damage known to be done to the vehicle] You can also type TBD or To Be Determined here

Total – add up all these amounts and enter the total here

The Designated Buyer is in default of the installment loan agreement and payment is made in accordance with state and local uniform and commercial codes covering the installment agreement.

We agree to indemnify and save [your name/business name] harmless from and against all claims, damages, losses and actions resulting from or arising out of our efforts, except as may be caused by negligence or unauthorized acts on the part of our agents representing us.

Dealer authorizing recovery

[your name/business name, address, and phone number here]

Notarize at the bottom

-Make a copy of the order for your records and give the order to your lien agent (the person who makes the actual acquisition of the vehicle).

Note that –

* If you follow these steps you will have made a legal repossession.

* Many people do not send a notification letter because many times a customer will try to hide the vehicle once they have received a letter like this, especially if they have no intention of paying.

* Most people are unaware of their rights when it comes to repossession of a vehicle, so they generally do not report someone who has not followed the proper procedure; however, if you do not send the certified letter notifying them of your default and giving them an opportunity to make payment, they have grounds to report you to state DMV Dealer Services and the state Attorney General, which may result in a fine and prosecution for violating recovery laws.

* Please note that some states do not allow a private property repossession to take place if the repossession agent is asked to leave (some states require that they leave and that you obtain a court order).

* Some states do not have restrictions on public property.

* Some states prohibit recovery at the customer’s workplace.

* Be sure to check the specific recovery laws for your state.