Massachusetts Repossession Laws: Your Rights and Options

In Massachusetts, missing even one car payment can trigger repossession. But lenders must follow strict rules before taking your vehicle.

They must send written notice and give you at least 21 days to catch up. If your car gets repossessed, you have 20 days to get it back by paying what you owe.

The lender must sell the car fairly. If it sells for less than your loan balance, you might owe the difference. However, if your loan balance was under $2,000, you won’t owe a deficiency.

How Many Payments Can You Miss Before Repossession?

You’re in default after missing just one payment. Your lender can start the repossession process immediately.

But they can’t take your car right away. Massachusetts law requires a 10-day waiting period. During this time, they must send you written notice.

What Notice Will You Receive Before Repossession?

You’ll receive written notice after you’re at least 10 days late. The notice must be titled “Rights of Defaulting Buyer Under the Massachusetts Motor Vehicle Installment Sales Act.”

Your notice must include:

• A clear statement about your vehicle
• The exact amount you owe
• At least 21 days from the mailing date to pay

Some lenders let you reinstate the loan by catching up on missed payments. Others require full payment of the remaining balance.

Pay the listed amount within 21 days to stop the repossession. If you don’t pay, the lender can take your car.

How Can You Prevent Repossession?

Contact your lender before you miss a payment. Many lenders offer temporary payment pauses or reduced payments during hardship.

If you’ve received a default notice, you still have time. Pay the overdue amount and fees before the deadline. This stops the repossession and keeps your loan active.

Struggling with your car loan and other debts? Filing Chapter 7 bankruptcy might help. The automatic stay immediately stops most collection actions, including repossession. You can speak with a bankruptcy attorney for free to explore your options.

What Can Repo Companies Do in Massachusetts?

Repossession companies work for lenders to recover vehicles from defaulted loans. Massachusetts allows self-help repossession, meaning no court order is required.

But repo agents must follow strict rules. They can only take your vehicle without:

• Using force
• Causing a disturbance or breaching the peace
• Entering your property like a driveway or garage without permission

Massachusetts law requires repo companies to notify local police within one hour. This prevents your car from being reported stolen.

What Happens to Personal Items in Your Car?

Remove all personal belongings before potential repossession. Lenders can take the vehicle but not your personal property.

If your car is repossessed with items inside, the lender must return them. Contact the lender to arrange pickup. Some lenders charge fees for returning personal items.

Act quickly to avoid delays and extra costs.

What Happens After Your Car Is Repossessed?

Massachusetts law gives you 20 days to redeem your vehicle. You must pay what you owe under the loan agreement.

This includes past-due payments, late fees, and reasonable repossession costs.

Don’t redeem within 20 days? The lender can sell or dispose of your car. Sales must be commercially reasonable, meaning fair market value pricing.

You’ll receive written notice before the sale with details about timing and method. You can attend and bid at public auctions.

What If Your Car Sells for Less Than You Owe?

Your car might sell for less than your remaining loan balance. The difference is called a deficiency balance.

Lenders can only collect deficiencies in certain situations. The amount is based on fair market value, not auction price. Cars often sell below market value at auctions.

If you owed less than $2,000 when you stopped paying, the lender can’t collect a deficiency. You won’t owe anything after the sale.

Do You Still Owe Money After Repossession?

Repossession doesn’t automatically erase your debt. You may still owe money after the car is taken.

Beyond possible deficiency balances, lenders charge reasonable repossession costs. These include towing, storage, and repo company fees.

Know you can’t keep the car? Voluntarily returning it before repossession reduces these extra costs. You’ll avoid towing and extended storage fees.

Can You Get Your Car Back After Repossession?

Getting your car back is possible but financially challenging. You must act within 20 days of repossession.

Pay what you owe plus all reasonable costs and fees. Include repossession and storage charges from the lender.

Miss the 20-day deadline? The lender proceeds with the sale. After that, you lose your right to redeem the vehicle.

Where to Find More Information

Need additional help with Massachusetts repossession laws? These resources provide free assistance:

• Mass.gov: What to know if your car is repossessed
• Volunteer Lawyers Project: Free legal assistance for low-income Greater Boston residents
• Greater Boston Legal Services: Free legal advice and representation
• Community Legal Aid: Free civil legal services in Central and Western Massachusetts
• Mass.gov: Massachusetts law about motor vehicle repossession