Bank Debit Account Without Knowledge

Virginia

My car was recently repoed, 23 Jan 2004 for the exact date. I was notified of it being sold at public auction, no biggie, since I have medical problem, limited income due to disability.

I receive a noticed of thank you for payment made for my car yesterday, and today I recieved a debit slip from my banking institution saying they debited my account. Is that legal? Money was taken out of my account without prior notice, recieved notice on 12th and 13th of March, debit occurred on 9th of march.

Also, I recieve letter from bank stating I owed an amount on the vehicle after the auction which occurred on the 2nd, I recieve this letter on the 9th of march, stating I have 10 days to pay the remaining amount or contact them of other options. I do not understand this, but it seems to me wrong and possibly illegal.

I did not have my car payment debited from my account, and I never, or dont remember ever signing permission for them to do so, and I have no records of such actions.

Oh, I should add, they debited my entire account leaving my only bank account with a balance of $0.00. How I pay my rent, medical bills and food for myself and my daughter is now a clue to me.

Confusing to me.

Thanks for any help.

Chris

[Ladynred]

Sounds like you have your checking account in the same bank that financed your car - bad idea.

What they did IS legal, its called an 'setoff' and they are within their rights to do so. Its probably in the fine print of your loan agreement and your checking account agreement.

They don't care how you pay rent, all they care is getting the money for the loan you defaulted on - the rest is your problem. Not trying to be harsh, but that's the way THEY view it.

What you still owe after the auction is called a deficiency, and it is quite legal as well. The sold the car for far less than what you owed on the note. The difference, plus fees to sell it, you now owe the bank. Sucks - but its legal and they will come after you for it.

I strongly suggest you close your checking account at that bank and open another one somewhere else. Any money that goes into the old account, the bank will take as long as you owe them on that loan.

I figured as much, and I didnt take it as being harsh, its reality or however you spell it.

I plan on closing the account Monday, no question about that.

Thanks for your input on the matter, I think I relized whats going on, still stunned and was curious on the matter.

[Ladynred]

Don't blame you for being stunned. Most people don't read the fine print in their loan or checking account agreements. I, for one, will NEVER get a loan from a bank I have my checking account in for just this reason - among others.

Question - were you notified of the sale of the vehicle , when, where, etc ? Or did you only get the notice that 'now you owe us $$xxx ' ?