repo

What is the name of your state (only U.S. law)? California
Hello,
I defaulted on car loan payment ($564.00) had 5 months of payment left before I defaulted. Original lender was Capital One Finance Auto loan who charged off the debt and sold to Genco Recovery one year ago. Car was repossess and impounded on 3/16/11. I contacted Genco for a settlement amount in which I am awaiting. Genco informed me that they have not had anyone who defaulted with only 5 month left on their contract and the normal settlement amount would be the Kelly Blue Book value of the vehicle, 2001 BMW Z3. The KBB value is more then the default amount on my contract/loan. Is it legal for Genco to charge me more that the defaulted amount on the loan?

sgrfoot said:

n. Is it legal for Genco to charge me more that the defaulted amount on the loan?

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barring some legally allowed administrative fees and repo fees or such type of charges, no.

sgrfoot said:

What is the name of your state (only U.S. law)? California
Hello,
I defaulted on car loan payment ($564.00) had 5 months of payment left before I defaulted. Original lender was Capital One Finance Auto loan who charged off the debt and sold to Genco Recovery one year ago. Car was repossess and impounded on 3/16/11. I contacted Genco for a settlement amount in which I am awaiting. Genco informed me that they have not had anyone who defaulted with only 5 month left on their contract and the normal settlement amount would be the Kelly Blue Book value of the vehicle, 2001 BMW Z3. The KBB value is more then the default amount on my contract/loan. Is it legal for Genco to charge me more that the defaulted amount on the loan?

Click to expand...

Whatever the "normal settlement amount" might be, they can only charge you the balance of the unpaid loan, plus any properly imposed costs and fees that you agreed to on that loan. They can't choose to charge you some arbitrary amount just because they cannot substantiate the actual loan balance that is due.

Before you pay ANY settlement amount, send them a debt validation letter to ensure that the correct amount is what you are being charged and that they are actually authorized to collect on this account. If they legally purchased the debt from Capital One, then as part of that validation, they should be able to provide documentation that substantiates the correct debt balance due, including the costs and fees that were included on the original loan documents.

See here for a sample letter that you can use: Letter For Debt Validation | The Consumer Law Group, P.C.