Indiana Repossession Laws: Protect Your Car Rights

In Indiana, your car can be repossessed after just one missed payment if your loan is in default. Lenders don’t have to warn you ahead of time. Repossession agents are allowed to take the car without a court order. They just can’t cause a disturbance or break the law while doing it. Even after repossession, you may still owe money if the car sells for less than what you owe. Extra fees may be added to your balance.

How Many Payments Can I Miss Without Risking Repossession in Indiana?

You can technically face repossession in Indiana after missing just one payment. Indiana law doesn’t require lenders to wait a certain number of missed payments before repossessing a vehicle. Repossession can happen as soon as you’re in default on the loan.

Stop Repossession Before It's Too Late

Behind on your Indiana car payments? Cambridge Credit Counseling can help you create a manageable payment plan and negotiate with your lender before repossession happens.

Lower Your Payments

Most car loans define default as failing to make your monthly payments on time. But default can also include other things, like not keeping the car insured. Every loan agreement is different. Review your contract carefully. Look for information about late payment policies, what counts as a default, and whether you have a grace period.

If you’re unsure how your lender handles late or missed payments, reach out to them directly. Our partner Cambridge Credit Counseling can also help you negotiate with creditors and create a manageable payment plan.

Will I Be Notified Before the Repossession? How?

No, Indiana law doesn’t require lenders or repossession agents to notify you before taking your car. Once you’re in default on your loan, they can repossess the vehicle at any time. Day or night, without giving you a heads-up.

Repossession agents do have to notify the local sheriff’s office either before the repossession or within two hours afterward. But this notice doesn’t have to be shared with you. Your car could be taken from your driveway, from a parking lot, or even while you’re at work.

If you’re behind on payments or out of compliance with your loan terms, assume that repossession could happen at any time.

How Can I Prevent a Repossession?

You may still have time to prevent a repossession, even if you’ve already missed a payment. One of the best steps you can take is to call your lender as soon as you start struggling to make the payment. Many lenders are willing to work with borrowers who are up front about their situation.

Depending on the lender, you may be able to get a new payment plan. You might qualify for a short-term extension or a temporary forbearance, which pauses your payments for a set time. This can help you avoid losing your car while also saving the lender the cost of a repossession.

In Indiana, your car can be repossessed as soon as you’re in default. Some loan agreements include ways to “cure” the default. Catching up on missed payments can get you back in good standing. Check your loan paperwork to see if that’s an option.

If curing the default isn’t possible, other strategies like refinancing, selling the car, or even filing for bankruptcy might help. We explore these options more below.

What Can Repo Companies in Indiana Do?

In Indiana, repossession companies can take your car without warning if you’re in default on your loan. But they must follow some rules. The biggest rule is that they can’t “breach the peace” while repossessing your car.

Repo agents can’t:

Damage or destroy your personal property
Use threats, intimidation, or force
Trick you into handing over the car
Enter your home, garage, or behind a locked gate without permission

Your “home” includes more than just the inside of your house. It also includes locked or fenced areas, attached garages, and other private spaces.

In most cases, repossession agents are legally allowed to take the car from your driveway, public streets, open parking lots, and repair shops. They don’t need your permission to do this. In Indiana, repo agents aren’t required to have a license. No state agency makes sure they follow best practices or treat you respectfully.

Can I Stop the Repossession?

You have the right to verbally object to the repossession. If you do, the agent is legally required to stop and leave. If they don’t, you can call the police and report a breach of the peace.

But you must follow the rules, too. If you try to physically stop the repossession, that could lead to injury, arrest, or extra fees added to your account.

Here’s what you can do instead:

Verbally object to the repossession (calmly and clearly)
Take notes on what’s happening
Record or photograph the event if it’s safe to do so
Write down the date, time, and any repo company info
Get contact information from any witnesses
Call the police if the repo agent refuses to leave after you object

Watching someone take your car can be incredibly upsetting. But staying calm and gathering information can help protect your rights later. If the agent broke the rules, your notes and evidence could be crucial if you need to file a complaint or take legal action.

What About the Personal Property in My Car?

If you’re at risk of repossession, remove all your personal belongings from your car ahead of time. This can save you a lot of stress and help you avoid losing things that matter to you.

If your car does get repossessed and your personal items are still inside, Indiana law gives you some protection. But only for a short time. If any of the items left in your car are worth $10 or more, the lender must:

Make a list (inventory) of those items
Send you a written notice by certified mail
Give you 30 days from the date the notice was mailed to claim your belongings

If you don’t claim your items within that 30-day window, the lender can legally keep them.

If you realize something important is missing after the repo, reach out to your lender right away. Let them know what items were left in the car so they can’t say you abandoned your property. Acting quickly gives you the best chance of getting your belongings back.

What Happens After a Repossession in Indiana?

After your car is repossessed in Indiana, the lender has two main options. They can either keep the car or sell it. But if you’ve paid more than 60% of the loan, they’re required to sell it, usually through a public auction.

If your car is going to be sold, the lender must send you a Notice of Sale. The notice will include details like the date, time, and location of the auction.

Most lenders choose to sell the car and try to get the highest price they can. But Indiana law says they must take commercially reasonable steps to make the sale fair. That doesn’t mean getting top dollar. But it does mean the lender has to:

Research and consider fair market value
Make basic repairs if needed to help sell the car
Advertise or list the car properly before the auction

Even if the final sale price is lower than expected, what matters most is whether the lender made a good-faith effort to sell the car fairly.

Do I Still Owe After a Repossession in Indiana?

Many people think that once their car is repossessed, the loan is wiped out. Unfortunately, that’s not how it works.

After your car is sold, the money from the sale is used to cover costs in this order:

Repossession-related fees (like towing, storage, and repo services)
Sale-related fees (such as cleaning, advertising, auction fees, or basic repairs)
Your outstanding loan balance

Your lender is required to send you a post-sale notice that explains how the money was applied. The notice should include an itemized breakdown of all charges. Review this carefully and ask for receipts if something looks off. Any errors will likely be your responsibility unless you catch them.

Keep all repo and loan documents in a safe place. You may need them if the lender sues or if you want to dispute a deficiency balance.

What Happens if There’s Still a Balance After the Sale?

If the sale brings in more than the total costs, you’re entitled to get that extra money back. But if the sale doesn’t cover everything, you’ll owe the remaining amount. We call this a deficiency balance. Many people end up with a deficiency if they were upside-down on their car loan. That means they owed more than the car was worth.

Indiana has a helpful protection if your car was originally purchased for $4,000 or less (as of 2025). In that case, your lender must choose: either repossess the car or sue you for the unpaid balance. They can’t do both. But if your car cost more than $4,000, they’re allowed to pursue a deficiency judgment against you after repossession.

One way to reduce how much you owe after repossession is to consider a voluntary surrender. You return the car to the lender yourself. A voluntary surrender may not erase your debt. But it can help you avoid extra fees for towing and storage. And it could show the lender you’re trying to cooperate, which might help if you’re negotiating a settlement later.

If you’re facing a deficiency judgment and struggling with multiple debts, our partner Cambridge Credit Counseling can help you consolidate payments and reduce interest rates.

Can I Get My Car Back After a Repossession in Indiana?

Yes. You should receive a Notice of Sale once your car is repossessed. The notice will give you instructions on how to redeem (get back) your car before it’s sold. Redemption often involves paying back all the money you owe plus the expenses of the repo.

Where Can I Find More Information About Repossession Laws in Indiana?

Indiana Legal Services has more information on auto repossessions and how to deal with a repossessed vehicle.
Indiana State Bar Association has information on accessing free legal advice and representing yourself in legal matters.
The American Bar Association has a list of places to find legal advice and assistance across the state of Indiana.
The current cost of a car where the lender has to choose between repossession and deficiency judgment is $4,000, but it changes annually.

Frequently Asked Questions

How many car payments can I miss before repossession in Indiana?

You can face repossession after missing just one payment in Indiana. The state doesn't require lenders to wait a certain number of missed payments. Repossession can happen as soon as you're in default on your loan, which typically means failing to make payments on time or not keeping required insurance.

What can repo agents legally do in Indiana?

Repo agents in Indiana can take your car without warning or a court order, but they cannot breach the peace. They can't use force, threats, or intimidation, damage your property, or enter locked areas like garages or fenced yards. They can take your car from your driveway, public streets, or open parking lots.

Do I still owe money after my car is repossessed in Indiana?

Yes, you typically still owe money after repossession. The sale proceeds first cover repossession and sale fees, then your loan balance. If there's a shortfall, you owe the deficiency balance. Indiana law protects buyers of cars costing $4,000 or less—lenders must choose between repossessing the car or suing for the balance, not both.

Can I get my personal belongings back after repossession?

Yes, Indiana law protects items worth $10 or more left in your car. The lender must inventory these items, notify you by certified mail, and give you 30 days to claim them. If you don't respond within 30 days, the lender can keep your belongings.

How can I prevent car repossession in Indiana?

Contact your lender immediately if you're struggling with payments. Many lenders will work with you on a new payment plan, temporary forbearance, or extension. You may also consider refinancing, voluntary surrender to avoid extra fees, or working with a credit counselor to create a debt management plan.

Indiana Repossession Laws: Know Your Rights When Facing Repo