Car Repo and Debt Collection

DelCar · #1 10-30-2007, 05:48 PM

I have lived in DE for quite a while. In 2001 I lost my job and my car was repossessed after I missed 2 payments. I never heard another word about the car its' sale at auction or anything related to the debt until about 2 months ago. I received a debt collection letter from Beacon Services,LLC
out of the blue. I am under the impression that I should have first been notified that my car went to auction and secondly that DE has a Statute of Limitations of 3 and in some cases 4 years for debt collection/ contractual obligations. I am being told I owe over $5000 and with interest over $7000. Can these people collect?

DelCar · #2 10-31-2007, 03:11 PM

In DE, if a creditor does not strictly comply with the notice provisions stated in the DE Commercial Code regarding the sale of the vehicle this may be used as a defense to prevent the creditor from recovering a deficiency judgement. Besides the Statute of Limitations, have I answered my own question? Is anyone familiar with DE law out there?

aaron · #3 10-31-2007, 03:18 PM

At this point you're asking about the Delaware Statute of Limitiations? Did they get a judgment back in 2001, or is the collection based just on the loan contract and deficiency?

DelCar · #4 10-31-2007, 04:50 PM

The letter I received from Beacon Services, LLC two months ago, was the absolute first time I had heard anything stemming from the repo itself or the deficiency. If I understand the law correctly, the creditor(s) failed to meet reasonable notice requirements. In regards to the Statute of Limitations, I know that DE has a 3 or sometimes 4 year limit on credit card collection, and nearly everything else. I could not find in exact words if repo deficiency is included in DE. As far as I know there was no judgement, this is the first I have heard of the deficiency itself.

Mr. Knowitall · #5 10-31-2007, 06:15 PM

A contract not under seal is subject to a three year limitations period, 10 Delaware Code § 8106, and a contract under seal is subject to a 20 year common law limitations period. Monroe Park v. Metropolitan Life Ins. Co., 457 A.2d 734, 737 (Del. 1983); State ex rel. Secretary of DOT v. Regency Group, Inc., 598 A.2d, 1123, 1129 (Del. Super. 1991). I doubt that the car loan contract was under seal, so it appears that the debt from the breach has expired.

DelCar · #6 11-01-2007, 03:43 AM

That is my understanding. Thank you Mr. Knowitall. Should I ignore the letters or respond by mail ?

aaron · #7 11-01-2007, 05:27 AM

You may wish to take a look at the sample dispute letter in this thread.

DelCar · #8 11-01-2007, 12:09 PM

Thank you Aaron, I copied the letter and will respond in kind.