How to Stop Car Repossession in Colorado

• Colorado generally gives you 20 days to cure a car loan default after the lender’s notice, but only once per loan in any 12-month period. C.R.S. 5-5-110, 5-5-111

• Bankruptcy’s automatic stay immediately stops a repossession. 11 U.S.C. 362(a)

• Chapter 7 allows you to keep your car if you can get current on your payments or pay its value, and it can erase any balance left after a repossession 11 U.S.C. 524(c)

• Chapter 13 may allow you to  catch up on car payments over time, even after a repossession, if you file before the repo sale. 11 U.S.C. 542

• Repo agents cannot breach the peace under C.R.S. 4-9-609. A wrongful repossession can give you leverage against the lender. C.R.S. 4-9-625

• You can redeem a repossessed car by paying the full balance plus costs, but only before the repo sale. C.R.S. 4-9-623

• You can challenge a deficiency balance if the repo sale or notice was improper under Colorado law, and it’s generally dischargeable in bankruptcy. 11 U.S.C. 727 

• An unpaid deficiency balance can lead to you being sued, a court judgment, and even wage garnishment. C.R.S. 5-5-105

In Colorado, your car can be repossessed about 30 days after you miss a payment, and sometimes sooner. If you’ve already received a “right to cure” notice in the past year, your lender may not have to warn you again before taking the car. Here’s how the timeline works:

• Day one - You miss a payment and are in default.

• Day 10 - Once you’ve been in default for 10 days, your lender can send you a written notice of your right to cure, meaning your right to catch up on what you owe. 

• 20 days after the notice - If you haven’t paid the past-due amount, your lender can repossess the car. The 20 days start when the notice is mailed, not when you receive it. 

• A second missed payment within 12 months of a notice - You don’t get another 20-day window. Your lender can repossess without sending a new notice. 

For most consumer auto loans, Colorado requires a warning before a lender can repossess your car for a missed payment. Once you’ve been in default for at least 10 days, the lender must give a written notice of default and your right to cure (catch up on missed payments) before repossession. You then generally have 20 days from when the notice was mailed or delivered to you in person to pay any past-due payments and late charges to restore the loan, as if you’d never missed a payment. 

Limitations on the Right to Cure

In most cases, the right to cure can only be used once in a 12-month period on the same loan. If you fall behind again within 12 months of that notice, the lender may be able to repossess with no further warning. You should treat that letter as your deadline to get and stay current on your car payments. 

The best time to stop a repossession is before the tow truck arrives, because getting your car back after the fact will cost you. 

Here are four ways to stop a car repossession in Colorado:

• Cure the default - Pay the full past-due amount plus any late charges within the 20-day window.

• Negotiate a payment plan - Many lenders would rather agree to a deferral or extension than repossess and auction a car. Get any agreement in writing. 

• Sell the car - A private sale usually brings in more than a wholesale action, so you end up owing less afterward.

• File for bankruptcy - Filing triggers the automatic stay, a court order that immediately stops a repossession. 11 U.S.C. 362(a)

Whatever you do, don’t hide the car. Concealing collateral can create new legal problems, including criminal charges, and close off options you’d otherwise have.

Chapters 7 and 13 bankruptcy stop a repossession, but what happens next depends on which one you file. When you file for bankruptcy, an automatic stay takes effect, which stops collection actions, including car repossession.

Chapter 7 can let you keep your car, but the stay usually gives you less time. You’ll generally need to get current on the loan and reaffirm it, which means signing a new agreement to keep paying. 11 U.S.C. 521(a)(2) Or you can redeem the car by paying the car's current value in a lump sum. 11 U.S.C. 722 If neither works, the lender can usually take the car, but Chapter 7 can erase any balance left after it’s sold. 11 U.S.C. 727

Chapter 13 lets you catch up on missed payments over three to five years and keep the car. 11 U.S.C. 1322 If you bought the car more than 910 days (about two and a half years) before filing, you may also be able to reduce the loan balance to the car’s current value. 11 U.S.C. 506 

In my experience, Chapter 13 is usually the better option for debtors with a steady income. 

Colorado lets lenders repossess without a court order, but under C.R.S. 4-9-609, the repo agent cannot “breach the peace.” That generally means the agent can’t: 

• Threaten you or use force 

• Break locks or gates to reach a car

• Bring the police to pressure you without a court order

• Take the car if you’re there and tell them to stop

Crucially, repo agents must notify local police or the county sheriff of a repossession no later than an hour afterward; preferably, they’ll notify them an hour beforehand. C.R.S. 42-6-146

Now, even though you may tell the agent, “Stop, don’t take my car!” it doesn’t mean you’ll get to keep the car. The lender can go to court for an order letting the sheriff take it. Nevertheless, a calm objection against the repossession can buy you more time. C.R.S. 4-9-609(b)(1)

Personal Property Recovery From a Repoed Car

You have a right to anything in the repossessed car that isn’t attached to it. You should send the lender and repo company a written request to retrieve your belongings. Make the request within a day or two of the repossession or as soon as you learn the car was taken. 

Wrongful Repossession Claims

If the agent broke any of these rules, or the lender took the car without sending a right-to-cure notice (unless an exception applies), you may have a wrongful repossession claim. You could recover damages, and the lender may agree to return the car and/or reduce or waive what you still owe to avoid a lawsuit. 

If you believe your vehicle was wrongfully repoed, I recommend that you: 

• Write down what happened

• save any photos or videos

• talk to a bankruptcy attorney.

They’ll be able to help you determine if you have a case.

Possibly, but you need to act fast. Most of your options end once the lender agrees to sell the car or actually sells it, so each one costs something different.

• Redeem the car - You can pay the full loan balance plus the lender’s reasonable repossession and storage costs any time before the lender sells the car or signs a contract to sell it. C.R.S. 4-9-623

• Ask about reinstatement - Colorado doesn’t give a general right to reinstate by paying only what’s past due, but some lenders will allow it.

• Watch for the sale notice - The lender must give you reasonable notice before selling the car. C.R.S. 4-9-611 Once it’s sold, getting it back is no longer an option. We suggest treating the date in the notice as your deadline. 

Filing for Chapter 13 before the sale may let you recover the car and pay the arrears through your plan. 11 U.S.C. 542 Lenders don’t always return it automatically, so your attorney may need to ask the court to order its return. 

An attorney who regularly handles these cases can help you act before your options expire. Bankruptcy filings and Colorado’s right to cure both have frequency limits, so let your attorney know if you expect more financial trouble ahead. Legal guidance can be crucial when:

• You can’t cure the default within 20 days of your notice.

• Your car was taken without notice or through threats, force, or entry into a locked area.

• You’ve received a notice of sale or a deficiency demand. 

• You’re not sure whether Chapter 7 or Chapter 13 is right for you.

At Robinson & Henry, our Bankruptcy Team helps Coloradans fight wrongful repossessions and deficiency claims, and uses Chapter 7 and Chapter 13 to stop collection and protect what they can keep. Call 303-688-0944 or book a consultation online 24/7.