My friend got me a car because her credit was better. She singed the paperwork & was approved for a loan on the car (she is the title holder until I pay her off). We signed a promissory note which states payment agreements plus I pay her $1,500.00 from my income tax refund. I expected more of a refund on my taxes then what I received so I requested to make monthly payments. She is not accepting the offer and said I can either pay her $1,500.00 or she will take the car. The promissory note just states "I will pay her $1,500.00 after 2012 federal income tax is received." Therefore, a date or deadline was never established on when I need to give it to her. I have not been behind on a car payment and the insurance is in my name. Since she is the title holder, does she have the right to re posess the car even though I have not been late on a payment and agreed to pay her just not a lump sum of my refund?
I think you would have a challenge convincing someone that you both didn't expect a lump sum $1,500 payment based upon how you present the facts. Yes, she CAN take her car. The practical question becomes whether she would want the car and the expense of a car she did not choose on her own. She may be willing to come to other terms because she is in a difficult position as well with her credit on the line and an unforeseen obligation in her future but fore renegotiation.
This question has more facts (and different facts) than your other question about the same problem.
As you word this question and set out the facts, it appears that the agreement was to wait for your income tax refund, and not that the refund was to be the source of the payment. If you were only buying time, and not specifying the source of the payment, your friend would have a stronger position. There could still be a mutual mistake as to the amount of your refund, but you may have trouble establishing that defense. You should know your own tax situation better than your friend, and she could contend that you misrepresented hoe much refund you were to receive.
Hopefully, you paid whatever refund you did receive to your friend. That would help to establish good faith. If not, you look pretty slippery.
There could be a defense of usury under Texas law, depending on how much money was being lent and for how long. If one violates Tex's usury law, the lender could lose the interest, and depending on the extent of the usury, lose the principal, and be liable for damages.
I suggest that you make payments as often as you can and as big as you can to retire the debt to limit your algal expense. If you can establish good faith, you may be able to stave off a suit.
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