A typical example of a great repossession circumstances can be as employs: Alice borrows $10,000 out-of Bob and you can guarantees their automobile since collateral. It indication a protection arrangement you to definitely states that Alice usually pay-off Bob from inside the monthly installments of $five hundred, and therefore Bob provides the straight to repossess the automobile in the event that Alice misses a couple successive repayments. Alice fails to shell out Bob for three days. Bob hires good repo broker so you’re able to repossess Alice’s auto. Brand new repo agent discovers Alice’s vehicle parked into a public highway and you can hooks it up so you can a tow vehicle. Alice sees this and run off from their house, shouting and you can cursing at Bob while the repo representative. She tries to go into their own vehicle and stop all of them out-of delivering they aside. The repo agent phone calls the authorities and you can drives away with Alice’s vehicles.
Contained in this analogy, Alice provides defaulted on her behalf mortgage and Bob features exercised their right to repossess her automobile. read more