If a person cannot make all the payments on a car loan, who owns the car?
Social Studies · Middle School · Mon Jan 18 2021
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If a person cannot make all the payments on a car loan, typically, the lender (such as a bank or financial institution) retains ownership of the car. The car is often used as collateral for the loan, which means the lender has the legal right to seize the vehicle if the borrower defaults on the loan. This process is known as repossession. After the car is repossessed, the lender may sell the car to recoup the money owed by the borrower. If the sale of the car does not cover the outstanding loan amount, the borrower may still owe the remaining balance to the lender.