Lost payments

[bwmiles]

What is the name of your state? Texas

Hello,

I will try to be as "to the point" as I can (I've been known to ramble).

I have a car financed, which requires proof of full coverage insurance. On October 15, 2006, we changed our insurer (to a national well known company). We received all of the paperwork including the declaration page that stated our time of coverage to be October 15, 2006 to April 15, 2007. We have been paying the insurer by direct payment set up through the bank. The payment has been taken from our account every month since October.

We recently found out that the auto finance company has not had proof of our insurance since the switch. So we have been accumulating an additional charge (app. $200/month) for the lender to add their insurance, so the car would be covered.

The solution was to simply fax the declaration sheet to the lender, to prove our coverage. The additional charges would be removed, and all would be well. The problem: The insurer has never received a single payment, and the down payment was rejected due to insufficient funds. Thus our insurance was cancelled within days of October 15, 2006.

The bank is "researching" the matter, and said they would get our money back. I'm not sure the money we paid toward our insurance will cover the total cost of the lenders insurance. Should we be responsible for the difference. Should we be responsible for any of the misappropriated funds. Even though we thought we had insurance, we did not. So, should we get our money back, and the bank reimburse what we will have to pay to the lender?

Also, this is not the first time something like this has happened with this bank. Last year we set up direct payment for my student loans, and none of those payments made it to where they were supposed to. We did get reimbursed for that, however.

Any feedback would be appreciated. Thank you,

BMiles

[seniorjudge]

Are you saying that thousands of dollars have disappeared from your account and no one knows where the dough has gone?

[bwmiles]

Not quite thousands. It is only the insurance premium for 5 to 6 months. They say we will get it back. My real question is should I have to turn around and send this money to the lender, to cover the insurance they bestowed upon me. Since, it appears I did not have valid insurance for this period (thus oweing the insurer nothing), and the insurer did not get the money, probably again because of a bank error, should I not get my money back and the bank be responsible for covering the lender's insurance?

[seniorjudge]

You are responsible for paying your own insurance.

Nothing you have posted so far indicates that the bank is guilty of anything.

[bwmiles]

So the bank is not responsible for misdirecting the funds or incorrectly setting up the "direct pay" with my insurer so that the funds never reached them? The bank was given correct information, and all of the information it requested and needed to have the insurance payment made directly from my checking account.

Of course, I am responsible for paying my insurance. Direct billpay is an extremely common practice. I gave all pertinent information, and I made sure the funds were in my account. To my knowledge I was paying my insurance. Now if I am making it more complicated than necessary (which I tend to do) I can try to be clearer, just let me know. What I call direct pay some people call automatic withdraw.

Thanks again,

BMiles

[debtcollector`]

Originally Posted by bwmiles

Of course, I am responsible for paying my insurance. Direct billpay is an extremely common practice.

Mistakes are even more common and it is your responsibility to make sure it was correct.

DC