Florida
An associate of mine has been driving and paying for a vehicle that she financed with her ex-boyfriend some time ago. They were both applicants on the loan, and both of their names are on the title. She has taken possession of the vehicle and has made all of the payments for the past 12 months.
She recently attempted to re-finance the car to remove her ex-boyfriend from the loan and title, but she was told that the vehicle was being held as collateral to a personal debt-consolidation loan that he had taken out a few months before. Therefore, the Credit Union they have their loan through was unable to refinance the vehicle.
The explanation she received was that the "Right to Offset" clause allowed them to use that vehicle as collateral on a loan completed un-affiliated to her because they were listed as "applicant 'A' OR applicant 'B'", and therefore they did not require her approval to hold the vehicle in this other loan.
So even if she possesses the vehicle, and has made all payments on time, the vehicle could be repossessed at anytime if her ex-boyfriend defaults on the terms of his personal debt-consolidation loan. He recently told her that he is intending to file for bankruptcy, so the matter is urgent and dire for her and her car.
What is the "Right to Offset", and does it just seem illegal to me? What are some courses of action she could take to remove her car as collateral from a loan she has nothing to do with?What is the name of your state (only U.S. law)?
An associate of mine has been driving and paying for a vehicle that she financed with her ex-boyfriend some time ago. They were both applicants on the loan, and both of their names are on the title. She has taken possession of the vehicle and has made all of the payments for the past 12 months.
She recently attempted to re-finance the car to remove her ex-boyfriend from the loan and title, but she was told that the vehicle was being held as collateral to a personal debt-consolidation loan that he had taken out a few months before. Therefore, the Credit Union they have their loan through was unable to refinance the vehicle.
The explanation she received was that the "Right to Offset" clause allowed them to use that vehicle as collateral on a loan completed un-affiliated to her because they were listed as "applicant 'A' OR applicant 'B'", and therefore they did not require her approval to hold the vehicle in this other loan.
So even if she possesses the vehicle, and has made all payments on time, the vehicle could be repossessed at anytime if her ex-boyfriend defaults on the terms of his personal debt-consolidation loan. He recently told her that he is intending to file for bankruptcy, so the matter is urgent and dire for her and her car.
What is the "Right to Offset", and does it just seem illegal to me? What are some courses of action she could take to remove her car as collateral from a loan she has nothing to do with?What is the name of your state (only U.S. law)?