Car loan sold to new bank only it was already paid.

[ARJ]

What is the name of your state? New York

Hi I'm new to this site so I hope I'm placing this in the right area. In 2000 I had a car loan with Northfork Bank and the car was a complete loss due to fire. It was under the impression that the car was paid off by the insurance company since I never received any further contact from the bank in regards to late payments, no payments etc. I never received a call or letter from the bank or a Debt Collector. I had full coverage with my insurance company so there was no reason for it not to be paid. Last year I noticed on my credit report for the bank it said "Write Off" I assumed this was due to the insurance company not paying the full amount and so the bank just wrote off the balance. I didn't check on it since I never received any contact in regards to repaying a debt.

Now this year I received a letter from Capital One saying that they are taking over car loans from North Fork Bank. I have tried to call them to inquire about this since there should be no debt collection for me on this loan due to the insurance company paying it off. There is never a representative available so I left a message and am awaiting a return call.

My question is if the insurance company didn't pay the entire amount and the bank chose to write it off instead of contancting me to pay the balance can another company now try to collect that amount whatever it is? Or if for some unlikely strange reason it wasn't paid off by the insurance company but the bank chose to just write it off instead of requiring me to continue paying can this new bank now require me to pay it?

Thank you,
ARJ

 

[Some Random Guy]

Contact your North Fork Bank and your insurance company to find out what was paid and what the outstanding loan balance was. You also need to find out why the bank never sent you any delinquency notices about your loan.

Also, what kind of insurance did you have? Did it include GAP insruance which would pay off loan balances that were greater than the value of the car?

Did you ever receive any check from the insurance commpany related to the fire?

Whenever you see "Write Off" on your credit report it does NOT mean that you don't owe any money. It does NOT mean that collections and lawsuits are stopped. It means that the creditor is telling the world "Hey, this guy is a deadbeat! Don't loan him any money because we just got stiffed by him and its unlikely we can get our money back!"

 

[ARJ]

Thank you I will check this out with the insurance company as well as the bank.

Whenever you see "Write Off" on your credit report it does NOT mean that you don't owe any money. It does NOT mean that collections and lawsuits are stopped. It means that the creditor is telling the world "Hey, this guy is a deadbeat! Don't loan him any money because we just got stiffed by him and its unlikely we can get our money back!"

Ok that just really ticks me off because if they had bothered to contact me I would have finished paying whatever the insurance company didn't pay if that is the case. It would have been nice for the insurance company to let me know they didn't pay it all as well.

So aside from contacting them is there anything else I can do about this? This was all seven years ago! It could have been paid off by now!

 

[ecmst12]

After this much time, the statute of limitations for collections may have expired also.

 

[ARJ]

After this much time, the statute of limitations for collections may have expired also.

Where can I find this out?

Also, what kind of insurance did you have? Did it include GAP insruance which would pay off loan balances that were greater than the value of the car?

Did you ever receive any check from the insurance commpany related to the fire?

I'm not sure if I had that or not. That was my second car but the first one I paid for in cash and only had basic insurance. I never received a check or anything from the insurance company after the car fire.

 

[Chien]

I agree with all of the advice offered by Some Random Guy, and I also wanted to check some additional matters.

Capital One is not a “new bank”; it is a debt collector and, if this happened in 2000, a debt would be beyond your state’s Statute of Limitations. That would be a defense to a suit to collect a balance, if there is one.

But the car loan was a special kind of transaction that falls under the Uniform Commercial Code, and I wanted to see if your state’s version provided for a longer SOL than NY’s general 6-year SOL for contracts. While the UCC does have different SOLs for some other types of transactions, I have not found one for this secured transaction. (There are NY members, and they may have other thoughts.)

Other than “this year”, you don’t say when the letter was received, and Cap One is not known for being responsive to debt dispute and validation requests, but sending one, certified, RRR, is still more advisable than waiting by the phone for a call that may not come.

When you are following Random Guy’s suggestions, also try to get from North Fork the exact date of your last payment on the loan, before the car was lost in the fire.

 

[ARJ]

I received the letter Sept 3rd or so, I tried to call then but was told they wouldn't have any information until after the 10th when everything was final. I just called again today but couldn't get a representative to talk to. I know the last payment was in July the exact date they processed the check I would have to check my bank statements. (I'm a packrat and keep everything!)

I intend to contact the bank I am very curious as to why they never notified me about anything. Its not their call to make that I won't pay since the car was a total loss. The insurance company as well should have notified me of something.

 

[Chien]

You have 30 days to send the dispute and request for validation, so get it off certified, RRR.

It's good to be a packrat. Keep records of everything said and done on this and who said what. Cap One has an unsavory reputation, and I doubt that you'll regret it. Use the "search" function, and I'm sure you'll find a good deal about Cap One. It might prove interesting, while you're waiting for your bank's response.

 

[ARJ]

Thanks everyone for all your help!

I will send it off first thing tomorrow. What is RRR? Notification of receipt?

 

[Chien]

Return Receipt Requested. (I apologize for not making that clear.)

 

[ARJ]

Thanks I thought that was what it was but wanted to be sure. I just checked an old credit report and it says the account was closed in OCT 2000. The car was destroyed the end of July. Two months later they are closing the account and writing it off as bad debt? That isn't even enough time to try and collect after the insurance company would have paid them. The amount is $3081.00 it seems to me that THEY chose to never contact me to let me know or give me the opportunity to pay the debt. I will verify this amount with the insurance company to make sure but can they do that? Decide for themselves I won't pay without contacting me at all and do a profit and loss writeoff and then seven years later sell that to another bank for collection?

I think I will send them both a dispute letter Northfork bank sent me a letter on the 4th stating they became a division of Capital One and that my loan would be transferred to them and they would be sending me a new payment book. I have yet to receive that.

 

[moburkes]

You say July, but of what year? 2000, or this year? I'm a little confused. Insurance companies don't send reports after claims are paid. You have to inquire. You can go to www.choicetrust.com, and order a free C.L.U.E. report, but it might not go back to 2000, if that's when the loss was.

You should have also followed up with the loan company to make sure that the balance was paid.

The insurance company paid the actual cash value of the vehicle, which, in many cases, is less than the loan balance. You would still be responsible for that balance. And, unless your vehicle was only a year or 2 old at the time of the loss, with low mileage, then it probably didn't qualify for GAP coverage, either.

 

[Chien]

OP - I don't want to inadvertently mislead you (because the rules change) and may have. If so, I don't want to do it again.

Cap One is actually a group of financial service companies - banking, collections, card issuance, mortgages etc. - under common ownership. While collection issues normally appear on this forum, your communication was from Capital One Banking? Or was it from Northfork saying they were transferring your loan to their new parent company?

I've re-read the thread, and I'm still confused.

While I still believe that you are beyond the SOL, did the letter say "sell" or "transfer"? Both terms are used.

 

[ARJ]

You say July, but of what year? 2000, or this year? I'm a little confused. Insurance companies don't send reports after claims are paid. You have to inquire. You can go to www.choicetrust.com, and order a free C.L.U.E. report, but it might not go back to 2000, if that's when the loss was.

You should have also followed up with the loan company to make sure that the balance was paid.

The insurance company paid the actual cash value of the vehicle, which, in many cases, is less than the loan balance. You would still be responsible for that balance. And, unless your vehicle was only a year or 2 old at the time of the loss, with low mileage, then it probably didn't qualify for GAP coverage, either.

July of 2000. I didn't think I would have to follow up, lessoned learned. Thanks for the link I will check it out.

While collection issues normally appear on this forum, your communication was from Capital One Banking? Or was it from Northfork saying they were transferring your loan to their new parent company?

I've re-read the thread, and I'm still confused.

Sorry I received a letter from NorthFork Bank and Capital One, the letter from Northfork said transfer.

Exact wording:

As you may know, effective Aug 1 2007 North Fork Bank became a division of Capital One, NA. As part of this change the servicing of your Auto Loan will be transferred to Capital One Auto Financ on Sept 7th, 2007. Transfer does not affect any terms and conditions on the loan instrument. After Sept. 7 007 any regular scheduled payments should be made payable to Capital One Auto Finance and mailed directly to the following address.

Then it goes on about how I will receive a new coupon book for payments etc. I haven't made any payments to them since the car fire. This letter is implying that I have been making payments and am not delinquent at all. How would I know about them becoming apart of Capital one in Aug. I haven't dealt with them in seven years.

They never even tried to collect the balance which is why I did not know there was one. It certainly wouldn't take me seven years to pay off $3081.00! When I contact the Insurance company I would like to know exactly when they paid off the balance because Northfork bank closed the account in Oct 2000. How soon after the insurance payment did they close this out. That could prove they didn't even bother to try and collect. This letter that I just received from North Fork Bank around Sept 5th -7th 2007 is the first I am hearing from them. As I said nothing in this letter implies that I am even delinquent in payments.

I would have paid that if I knew I owed it. Seems to me they decided to not try and collect of their own free will. How can I pay a debt I don't know I owe?