Does or doesn't an auto loan agreement become null and void if that collateral auto is repo'd? If that's the case, as I thought per the UCC and a state's code, than how can an "alleged defaulted" debt be sold by the OC if there is not a loan agreement to sell? How can a collection attorney get a summons legally if there is no debt to collect? I am thinking because the average consumer does not know the credit laws? If they know their car was repo'd and they get a letter from an attorney demanding payment of the loan balance (not a deficiency) the debtor is rellay none the wiser, right? They either pay up if they can afford it or shun the letters, hide and let a default judgment occur if they are summoned because they can't afford it and they are scared. I am also guessing that loan agreement was in a portfolio that the debt buyer bought from the OC, probably for 10 cents on the dollar. The bank may not have know it was voidedwhen it was sold? Or the account was never updated with the OC AFTER it was voided? Any thoughts?
Well, the only part that I'll be confident to talk about is "How can a collection attorney get a summons legally if there is no debt to collect?" The answer for this is simple... All it takes to get a summons legally, is a filing fee, and a form... Granted the form says that providing a false statement on the form is a crime, but how many CAs care about breaking the law? They do it for just the reasons that you said, in most cases, most consumers are too uneducated (in credit law matters) to know that the CA is blowing smoke, and either pays up, settles, or gets default judgemented...
