Is not paying car loan is a crime?
I've been ask this scenario by one of my co worker, if they took a loan of a car and not paying at all from the beginning can that be consider a criminal matter like such arrest can occur or its only repossession that will likely to happen? My personal answer would be a repossession that would most likely occur since it's not a theft considering the lender approve the loan and the borrower went default. Please let me know if you have experience in the past or have knowledge. No stupid answer please. thanks.
- vic91106Lv 71 decade agoFavorite Answer
It is a civil matter, unless your co-worker takes active steps to defraud the lender or hide the car in the event of a repossession.
- SCOTT MLv 71 decade ago
Nin-payment of a car loan is not a crime, and the lender's recourse is to repossess the car and sell it. The lender can then get a judgment for any shortfall. However, if the borrower falsified any information on his loan application, that is a felony and is a serious crime.
Lenders are usually pretty quick to look into quick defaults and push for prosecution if they believe the loan application contained any false information. The lender may have approved the loan, but if its approval was based on false information provided by the borrower, the borrower can be in big trouble.
- Anonymous1 decade ago
Its is wrong this is why the world markets are in a mess .Some young people get a car loan and do not know what to do when they cannot repay the debt instead recovery of the car happens .But when it comes to a loan bankruptcy should not be an option instead the bank should have optional debt recovery without taking money that places people in the street and the bank never loses money flow .
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- LynnLv 51 decade ago
It's a civil matter. They might be sued or have their car repossessed, and it's likely to impact their credit, but failing to repay a loan is not a crime.
- scott bLv 71 decade ago
Not only a Civil Matter, but it's really stupid because that will affect your credit rating for a LONG time...
- roscoedeadbeatLv 71 decade ago
You are right that repo. is most likely, but technically it is the civil crime of violating a contract.