In most states illegible contracts certainly pose a significant problem. Without a legible contract showing the terms of default, the specific vehicle information, as well as the debtor’s signature, most DMV’s will not process the vehicle title application for repossession.
Unfortunately, in most states, you will be required to obtain a court ordered title, whether it is a quiet title, a declatory judgment, or in some cases a bonded title.
Collection Manager Tips:
- Most easily resolved if addressed immediately at the time of origination
- You have to go through the court system in most states
- In some states you don’t have to go through the courts, you can use a dealer certified reprinted copy of the contract and an affidavit explaining the facts (such as Indiana).
We cannot emphasize enough the importance of receiving a legible signed contract prior to funding a deal. As a collection manager, realize that once the debtor goes into default, they typically won’t be cooperative and it becomes very difficult to obtain the repossession title.
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