finance company is saying car was repo'd when it was really a total loss

[britnanyh]

What is the name of your state (only U.S. law)? ca
hi. I purchased a vehicle from a car lot and was told I had to purchase gap insurance due to an upside loan, so I did. the car got vandalized and my regular insurance company deemed it a total loss. they paid out to the finance company $5222.00 for fair market value. while waiting for the gap insurance to pay "the balance", the finance company sent me a letter stating they had repo'd of the vehicle and if I wanted it back I would have to pay "the balance" due. however, they never mention the total loss and the pay out they received. now they are falsifying documents to ruin my credit and make me look bad. I have all the paperwork from my regular insurance company to prove what i'm saying. who would I contact to help me with this issue? what they are doing is wrong. they are misrepresenting the facts. thank you

 

[FlyingRon]

Did you stop making the payments? The car being totalled means SQUAT to your loan agreement. Until the loan is paid off, you're responsible.

 

[LdiJ]

Did you stop making the payments? The car being totalled means SQUAT to your loan agreement. Until the loan is paid off, you're responsible.

I disagree Ron. Yes, the OP is responsible until the loan is paid off, however, it is never recommended to continue paying loan payments when a car has been totaled and the insurance is paying it off.

OP, how long have you been waiting for the gap insurance to pay off the balance? You perhaps need to be a squeaky wheel with them.

 

[FlyingRon]

I disagree Ron. Yes, the OP is responsible until the loan is paid off, however, it is never recommended to continue paying loan payments when a car has been totaled and the insurance is paying it off.

OP, how long have you been waiting for the gap insurance to pay off the balance? You perhaps need to be a squeaky wheel with them.

Insurance DIDN'T pay it off. That's the problem.

 

[LdiJ]

Insurance DIDN'T pay it off. That's the problem.

The primary insurance already paid part of it off...the wait is on the gap insurance. Clearly the gap insurance already has the payoff amount, and therefore will cut a check for that much. If the OP makes any payments he/she won't get that back.

 

[Ohiogal]

The primary insurance already paid part of it off...the wait is on the gap insurance. Clearly the gap insurance already has the payoff amount, and therefore will cut a check for that much. If the OP makes any payments he/she won't get that back.

That is an assumption which has NOT happened. That is the problem. If a payment was due since the accident but before the gap insurance pays (or any difference between the payoff amount the gap insurance received and what is actually owed due to interest and late fees) OP is on the hook.

 

[Nellibelle]

That is an assumption which has NOT happened. That is the problem. If a payment was due since the accident but before the gap insurance pays (or any difference between the payoff amount the gap insurance received and what is actually owed due to interest and late fees) OP is on the hook.

I disagree with you and agree with LdiJ! It is pretty flagrant for the Finance Co. to receive payment for the fair market value of the car, knowing that there is Gap coverage, but non-the-less repossessing the car anyway, despite the OP's proof of Gap coverage.

It is profound how the Finace Co. received over 5k at a time when otherwise the normal car payment would have been far far less! I would think they should be patient enough to wait a reasonable amount of time to get their Gap payment rather than to repossess the car, thus messing up the OP's credit standing! I think the OP should consult with an Attorney regarding the possibility the Finance Co. isn't being lawful in this situation.

 

[RRevak]

I disagree with you and agree with LdiJ! It is pretty flagrant for the Finance Co. to receive payment for the fair market value of the car, knowing that there is Gap coverage, but non-the-less repossessing the car anyway, despite the OP's proof of Gap coverage.

It is profound how the Finace Co. received over 5k at a time when otherwise the normal car payment would have been far far less! I would think they should be patient enough to wait a reasonable amount of time to get their Gap payment rather than to repossess the car, thus messing up the OP's credit standing! I think the OP should consult with an Attorney regarding the possibility the Finance Co. isn't being lawful in this situation.

Just because the loan company received payment for FMV of the car doesn't mean that was enough to satisfy the loan. Just because the Gap insurance is GOING to pay doesn't mean they DID pay. If there is a balance that has NOT been paid by Gap or the FMV payout then Op still owes for the balance one way or another until Gap comes through. How does the finance company know for sure Gap is even going to give them a check? Clue, they don't until a check is actually in their hands. As far as the bolded, you're dreaming if you think the finance company should be patient. They are owed money, would YOU be patient if someone you loaned money to chose not to pay?

 

[Ladyback1]

I disagree with you and agree with LdiJ! It is pretty flagrant for the Finance Co. to receive payment for the fair market value of the car, knowing that there is Gap coverage, but non-the-less repossessing the car anyway, despite the OP's proof of Gap coverage.

It is profound how the Finace Co. received over 5k at a time when otherwise the normal car payment would have been far far less! I would think they should be patient enough to wait a reasonable amount of time to get their Gap payment rather than to repossess the car, thus messing up the OP's credit standing! I think the OP should consult with an Attorney regarding the possibility the Finance Co. isn't being lawful in this situation.

Who's to say they have not waited a reasonable amount of time? OP doesn't give a timeline of how long this has been going on.

 

[LdiJ]

[QUOTE=Ladyback1;

While I do agree with this when gap insurance is involved, the original loan company KNOWS that there is gap insurance, because gap insurance is a conditional of financing.

 

[racer72]

I disagree Ron. Yes, the OP is responsible until the loan is paid off, however, it is never recommended to continue paying loan payments when a car has been totaled and the insurance is paying it off.

OP, how long have you been waiting for the gap insurance to pay off the balance? You perhaps need to be a squeaky wheel with them.

BS. When a vehicle of mine was totalleed and the lender was informed, the first thing I was told was to continue making my payments till they release interest in the vehicle, ie, the loan is paid in full.

If the OP makes any payments he/she won't get that back.

Again BS. I overpaid mine by 2 payments. I received a check for the overpayment before I received the release of interest. Please explain how a lender has the legal right to keep money not owed to them.

 

[LdiJ]

BS. When a vehicle of mine was totalleed and the lender was informed, the first thing I was told was to continue making my payments till they release interest in the vehicle, ie, the loan is paid in full.

Was gap insurance involved in your case?

Again BS. I overpaid mine by 2 payments. I received a check for the overpayment before I received the release of interest. Please explain how a lender has the legal right to keep money not owed to them.

BS right back at you. Gap insurance is a condition of financing. Gap insurance is paid in advance. Gap insurance pays the difference between the balance due and what is paid by the primary insurance. If the balance due is lower because the owner kept making payments, who is going to get the "refund"?

My dad was an insurance agent for a very long time. He was adamant that if gap insurance was involved that the owner should NOT continue making payments.

 

[racer72]

Was gap insurance involved in your case?



BS right back at you. Gap insurance is a condition of financing. Gap insurance is paid in advance. Gap insurance pays the difference between the balance due and what is paid by the primary insurance. If the balance due is lower because the owner kept making payments, who is going to get the "refund"?

My dad was an insurance agent for a very long time. He was adamant that if gap insurance was involved that the owner should NOT continue making payments.

BS back to you. I have never bought gap insurance. Gap insurance have never been a requirement of any vehicle purchases I have made, even those with a minimal down payment. Unless a purchase agreement specifically states that monthly payment are not required because the purchaser has gap insurance, monthly payments must be made. I just checked the last 2 contracts for vehicles I purchased, neither states anything at all about gap insurance. They do state that the minimum monthly payment must be paid by the due date or a late fee will be assessed or the vehicle may be repossessed.

 

[Ohiogal]

While I do agree with this when gap insurance is involved, the original loan company KNOWS that there is gap insurance, because gap insurance is a conditional of financing.

Wrong. GAP insurance is NOT ALWAYS a condition of financing. ETA: What racer said!

 

[Zigner]

I don't believe the OP was ever required to get gap insurance. Rather, I believe that the dealer sold him gap insurance with dubious claims. The car dealer is not the finance company.