If you're delinquent on your vehicle loan (in breach of contract), the vehicle CAN be possessed at ANY time. Just because they haven't doesn't mean they won't. Even so, until they do, unless you obtained the loan fraudulently, you're freely entitled continued use of the vehicle as its current owner.
As a contractual leinholder, the bank or finance company can (and likely) will take independent actions, up to and including referring your account to their own collections department, a collection agency, and/or report your delinquent obligation to any or all of the credit reporting agencies.
You continue to owe the loan regardless of the vehicle's disposition or who happens to possess it. Only if it's repossessed and subsequently sold to recoup the outstanding balance does any thing change. The lender is empowered by your power of attorney to sell the vehicle on your behalf and any amount they obtain for selling the vehicle (less repossession, storage, and sale fees) is applied to the outstanding balance. If it's insufficient to cover the entire balance, you continue to owe the lender as a non-secured debt. If they happen to sell it for more than you owe, they're obligated to refund the difference to you.
The one thing you CAN'T do is sell the vehicle. Because of the lien, the title is "encumbered"; and it must become unencumbered before you can (legally) assign ownership to someone else. Indeed, you usually don't even have access to the title until the lien is satisfied. Some people have applied and received (through loopholes) replacement titles, claiming the original was lost or destroyed and falsifying (committing perjury) whether or not any liens (encumbrances) exist, but most eventually get caught and are prosecuted for both perjury and/or theft or fraud once they sell the vehicle.
Best of luck. I hope this helps.
· 10 years ago