Can You Challenge a Wrongful Auto Repossession in Colorado?

Few experiences are as frustrating or surprising as discovering your vehicle has been repossessed. Whether it happens at work, at home, or in a parking lot, a sudden repossession can leave you feeling powerless and unsure of your rights. But what if the repossession wasn’t legal to begin with?

In Colorado, borrowers and creditors both have rights and when auto lenders cross the line, consumers may be able to challenge the repossession and even seek damages. If you believe your car was taken wrongfully, this blog explains how auto repossession laws work in Colorado, what qualifies as wrongful repossession, and how you can take legal action to protect yourself.

When Is Auto Repossession Legal in Colorado?

Under Colorado law, a lender (or “secured party”) can repossess a vehicle without going to court as long as the borrower has defaulted on the loan and the repossession is conducted without breaching the peace.

Common reasons for lawful repossession include:

• Falling behind on monthly payments
• Failing to maintain required insurance
• Violating other terms of the loan agreement

Unlike some other states, Colorado doesn’t require lenders to give prior notice before repossessing a vehicle. However, the repossession must still be carried out according to the law and that’s where many lenders or their agents get it wrong.

What Is Considered a Wrongful Repossession?

A repossession may be considered wrongful if it violates Colorado or federal law or if it breaches the terms of the original loan agreement. Examples include:

• No actual default – If you were not behind on payments or in violation of the contract
• Breach of the peace – If the repo agent used threats, force, or entered a locked garage
• Repossession after payment arrangement – If you had a written agreement to defer payment and the lender repossessed anyway
• Mistaken identity – If your vehicle was taken in error due to clerical mistakes
• Failure to provide post-repossession notice – Lenders must notify you of your right to reclaim the vehicle or challenge the debt

In any of these situations, the repossession may be deemed unlawful and you could have grounds to challenge it and pursue compensation.

What Rights Do You Have After a Repossession in Colorado?

Even if your vehicle was legally repossessed, you still have important rights:

• The right to redeem the vehicle by paying off the loan and any repossession costs before it’s sold
• The right to receive a notice explaining how and when the vehicle will be sold
• The right to a fair sale – The lender must make a commercially reasonable effort to sell the car for a fair price
• The right to challenge a deficiency balance if the vehicle is sold for less than what you owe

If the lender or repo company violates any of these rights, they may be liable for damages — and in some cases, you could recover the vehicle or avoid further payment obligations.

How to Challenge a Wrongful Repossession

Challenging a wrongful repossession typically involves a combination of documentation, legal analysis, and, in some cases, filing a lawsuit. Here’s how the process generally works:

1. Review Your Loan Agreement

Start by reading the terms of your auto loan to determine whether you were in default. Look for payment deadlines, grace periods, and any written agreements you had with the lender about payment modifications.

2. Document the Repossession

Write down everything you remember about the repossession: date, time, location, any conversations you had with the repo agent, and whether they used force, threats, or entered a closed space. Take photos or videos if possible.

3. Request Records from the Lender

Ask your lender for a detailed statement of your account, including payment history, notices sent, and the name of the company that performed the repossession.

4. Contact a Consumer Rights or Creditor Law Attorney

An experienced attorney can determine whether your rights were violated and help you prepare a claim. In Colorado, wrongful repossession may fall under state consumer protection laws or the federal Uniform Commercial Code (UCC).

5. Consider Filing a Complaint or Lawsuit

If the repossession was unlawful, you may be able to file a complaint with the Colorado Attorney General or pursue a civil lawsuit against the lender or repo agent. You could recover damages for:

• Loss of the vehicle
• Emotional distress
• Loss of personal property inside the car
• Costs related to missed work or alternative transportation
• Punitive damages in extreme cases

What if the Vehicle Was Already Sold?

If your car has already been sold at auction or by private sale, you may still be able to sue for damages, especially if the sale was not conducted properly or you weren’t notified. In some cases, the sale can be voided, or the lender can be required to pay the difference in value.

Additionally, if the lender tries to collect a deficiency balance (the amount left over after the car is sold), you may be able to contest that amount or avoid paying it altogether if the repossession violated your rights.

Contact Douglas D. Koktavy Law Firm today for Legal Representation

At Douglas D. Koktavy Law Firm, we represent individuals and creditors throughout Denver and the state in complex auto finance matters, including wrongful repossession claims. Whether you're a borrower who lost your vehicle or a lender facing legal challenges, we can help clarify your rights, defend your position, and pursue fair outcomes.

Contact us today for a consultation. Let’s find out whether your repossession was legal and what legal remedies may be available to you.