Moreover, if state law gives you the right to cure the default, the creditor can't repossess the car before the right to cure has expired. When a seizure is wrongful, the creditor generally shouldn't keep the car or collect a deficiency. The creditor may owe you money instead. Creditors must either keep the cars they repossess or sell them. If a creditor keeps a car, which is rare and allowed only in certain circumstances, the creditor can't seek any more money from you.
Creditors usually sell a car after repossessing it.
The law is very strict on the exact procedure the creditor must use in selling a repossessed car. You can challenge the creditor's attempt to collect a deficiency simply by showing the creditor didn't take the correct steps in selling the car. Tripping up on one technical requirement is usually enough to stop a deficiency. Special laws and rules apply where you leased the repossessed car instead of buying the car on credit. The lease will specify the formula used to calculate how much you owe upon default or early termination.