California Law on Redemption of a Leased Vehicle

California allows 15 days for a redemption to be filed and this can be extended with a written request.

For those who are struggling financially, the redemption of a vehicle loan may prove an attractive option. It may be the way to salvage funds due to a vehicle's depreciation.

What Is Redemption?

Many times, folks will find the value of their vehicle has depreciated to much less than the loan they are paying on it. Redemption can occur when an individual files for bankruptcy and in the case that a vehicle has been repossessed for non-payment. Redemptions can then potentially settle the loan for the depreciated amount rather than the full outstanding debt.

Intent

If a creditor wishes to sell or dispose of a repossessed or surrendered vehicle in California, they must notify the person the vehicle was taken from. They can send the letter of intent either by certified mail, first-class mail or they can have the letter served. This allows the debtor to pursue a redemption if desired.

Period for Redemption

As the individual interested in redemption, you have a full 15 days from the time that you were served the notice or the creditor mailed it to redeem. You have to pay the full amount of the contract as well as any other fees that have accrued such as the costs for the repossession and towing. You may submit a "written request" to the "seller or holder" for an extension of your redemption period of up to an additional 10 days.

References

• San Diego Bankruptcy Now: Dealing With Car Loan Problems in Bankruptcy