Car Repo Question

[Io-bot]

My friends cousin, a younger chick had her G6 repossessed... she stopped making payments on it and they told her they would be taking the car so she let it go. Anywho, the question is, I guess when she purchased the car she didnt have the credit, so she had her grandmother cosign, but the dealer made the grandmother the primary buyer and the chick the cosigner... now I guess the bank or the collections agency called the 80+ year old and is telling her the car sold for $11K and that she owes the balance...

I was told on another forum that in CT their is a Fair Market Value thing...

Anyone know anything about this stuff? You can PM me if needed.

[Awesome]

Sounds right.

[VinceF2]

yip... sounds right... Grandmother is on the hook for the difference now.

[SteveM]

she stopped making payments on it and they told her they would be taking the car so she let it go...

so she had her grandmother cosign.

Even if the grandmother was not the primary buyer, she would be responsible as the cosigner.

Basically, this young "lady" screwed her own grandmother over as soon as she stopped making payments, nevermind allowing the repo.

What is this world coming to?

[MidNight Powder]

This is the way it works.
Car is repod then goes to auction where it is sold. The bank tries to get as close as they can to the original loan amount plus all auction fees repo fees collection fees which are added to the original loan amount. If the car sells for more then the loan plus all fees then the debtor gets the difference but if it sells for less then the debtor is on the hook for the balance of the loan plus all fees.

Now this is where it gets tricky because the dealer screwed up and made the grandmother the primary she is on the hook for the balance. A few options, she can ask the grandaughter to pony up the money and pay it off in full or if the collection company will set up some type of payment plan. Option B if the grandmother can pay the balance in full then go after the grandaughter for the money outside or inside of court.

Unfortuntly because the grandaughter is listed as a cosigner then she has very little liabillity unless the grandmother defaults on the payment of the balance then the collection company will go after the cosigner.

Hope that helps.

[SSearchVT]

In a lot of states the bank is not required to inform the person that had the car repo'd what the car sold for. Just that it sold, and they are not responsible for additional payments. The bank can legally keep the profit...

[Io-bot]

There was no profit made, I dont know what the Fair Market Value is for a 2 year old G6 but im sure its more than 11K. They are going for the difference of what was owed (lets say 20K) and what the car sold for 11K ($9K).

(g) Fair market value. If the goods retaken consist of a motor vehicle the aggregate cash price of which was more than two thousand dollars, the prima facie fair market value of such motor vehicle shall be calculated by adding together the average trade-in value for that motor vehicle and the average retail value for that motor vehicle and dividing that sum by two. Such average trade-in value and average retail value shall be determined by the values as stated in the National Automobile Dealers Association Used Car Guide, Eastern Edition, as of the date of repossession. If the goods retaken consist of a boat the aggregate cash price of which was more than two thousand dollars, the prima facie fair market value of such boat shall be calculated by adding together the average trade-in value for that boat and the average retail value for that boat and dividing that sum by two. Such average trade-in value and average retail value shall be determined by the values as stated in the National Automobile Dealers Association Appraisal Guide for Boats, Eastern Edition, as of the date of repossession. In the event that the value of such motor vehicle or boat is not stated in such publication, then the fair market value at retail minus the reasonable costs of resale shall be determined by the court. The prima facie evidence of fair market value of such motor vehicle or boat so determined may be rebutted only by direct in-court testimony. If such value of the motor vehicle or boat is less than the balance due under the contract, plus the actual and reasonable expenses of the retaking of possession, the holder of the contract may recover from the retail buyer, or from anyone who has succeeded to his obligations, as a deficiency, the amount by which such liability exceeds such fair market value, as defined in this subsection. If the actual resale price received by the holder exceeds such fair market value, as defined in this subsection, the actual resale price shall govern.

[Mondo]

basically your friends cousins grandmother just got by her own granddaughter

[DaSarge]

nothin like a good 'ol repo to bring the family together

[noudidnt]

This is the way it works.
Car is repod then goes to auction where it is sold. The bank tries to get as close as they can to the original loan amount plus all auction fees repo fees collection fees which are added to the original loan amount. If the car sells for more then the loan plus all fees then the debtor gets the difference but if it sells for less then the debtor is on the hook for the balance of the loan plus all fees.

Now this is where it gets tricky because the dealer screwed up and made the grandmother the primary she is on the hook for the balance. A few options, she can ask the grandaughter to pony up the money and pay it off in full or if the collection company will set up some type of payment plan. Option B if the grandmother can pay the balance in full then go after the grandaughter for the money outside or inside of court.

Unfortuntly because the grandaughter is listed as a cosigner then she has very little liabillity unless the grandmother defaults on the payment of the balance then the collection company will go after the cosigner.

Hope that helps.

This is actually pretty close. The problem is that no car sells at an auction for fair market value. A 20k car usually sells for about 11k at an auction. This is wholesale. Most loan contracts do not contain a fair market value clause and even if they did, the collection group of the first party loan company is not required to adhere to it, as they are first party and the laws apply differently to them.

I did this job for several years. It does not matter what order the signer -cosignor is in, they are both equally liable for the remainder of whats left.

The best thing to do is to see which company had the loan and who is doing the collecting. At the first party level they have to obey a lot of laws, and they will usually keep it in house for a while. The longer you can go without making a payment on the debt the better off you are. As long as they dont sell the contract to a secondary company. You can usually settle for much less than what is owed if you are patient.

[Io-bot]

This is actually pretty close. The problem is that no car sells at an auction for fair market value. A 20k car usually sells for about 11k at an auction. This is wholesale. Most loan contracts do not contain a fair market value clause and even if they did, the collection group of the first party loan company is not required to adhere to it, as they are first party and the laws apply differently to them.

I did this job for several years. It does not matter what order the signer -cosignor is in, they are both equally liable for the remainder of whats left.

The best thing to do is to see which company had the loan and who is doing the collecting. At the first party level they have to obey a lot of laws, and they will usually keep it in house for a while. The longer you can go without making a payment on the debt the better off you are. As long as they dont sell the contract to a secondary company. You can usually settle for much less than what is owed if you are patient.

Thanks for the help... i dont know the full details of the situation or who is going after the grandmother now. Im guessing a collections agency... the 80+ year old doesnt even speak English...

[SteveM]

basically your friends cousins grandmother just got by her own granddaughter

Owned?

I'd opt for screwed..

... and where the hell is Richie asking if she's hot, the boy's slipping

[noxin]

Now this is where it gets tricky because the dealer screwed up and made the grandmother the primary she is on the hook for the balance.

I'd say with 99% certainty, that the dealer did this on purpose because the granddaughter's credit wasn't good enough to get the loan, so they flopped the names on the application to get it approved.

They did this with my ex-wife's car loan when her mother co-signed for her. We never had the repo issue, but it definitely made life interesting.

[e30addict]

It does not matter what order the signer -cosignor is in, they are both equally liable for the remainder of whats left.

dead on

[Pittenger5]

... and where the hell is Richie asking if she's hot, the boy's slipping

I dont need her fucking up my credit score too.

[obsolete]

My friends cousin...

So... how you gonna pay back your grandma?

[SteveM]

I dont need her fucking up my credit score too.

Nice to see you back on your game!

[MidNight Powder]

This is actually pretty close. The problem is that no car sells at an auction for fair market value. A 20k car usually sells for about 11k at an auction. This is wholesale. Most loan contracts do not contain a fair market value clause and even if they did, the collection group of the first party loan company is not required to adhere to it, as they are first party and the laws apply differently to them.

I did this job for several years. It does not matter what order the signer -cosignor is in, they are both equally liable for the remainder of whats left.

The best thing to do is to see which company had the loan and who is doing the collecting. At the first party level they have to obey a lot of laws, and they will usually keep it in house for a while. The longer you can go without making a payment on the debt the better off you are. As long as they dont sell the contract to a secondary company. You can usually settle for much less than what is owed if you are patient.

Ok so you know the loan side of things a little better then me. I know the auction side of things and what i posted is just from what i have picked up working there.

[OreoGaborio]

Where's Daviid when you need him? He was smart enough to co-sign on his (step?) brother's truck.

[Hauptman]

i do not believe that the fair market value works with repos. The amount that the vehicle sells for at auction is applied towards the loan to help the lender recoup loss. This is always far less than the loan is. The remaining balance is the responsibility of the borrower(s). I deal with this all day.

[Fitz]

$11k is fair market value. All they have to show is that it went to auction and was bid on. Now if it was sold to the owner of the repo company for $500.... well then you may have an argument.

Fitz

[gus310]

i had a tacoma repo'ed about 5 years ago, i owed just under 18k on it, it sold for about 8k at auction. they badgered me for a short while and i sent the "collection" company a few hundred bucks after hearing threats of garnished wages and court, but then stopped paying them and never heard from them again. its on my credit report now as a "chargeoff" meaning i defaulted and didnt pay, and they know they arent getting any money from me.

i wonder if it was some kind of scam from a 3rd party trying to get money out of me but whatever, another year or two and its past the 7 year mark where it supposedly falls off your credit report. ill be keeping an eye on it.

comes down to i was naive and got kinda screwed into the loan, but i learned a few valuable lessons along the way.

1-i should never have signed the paperwork, much less left with the new truck instead of my old car.

2-after the repo i wanted no loans or anything which did more damage to my credit than the repo did, since i lost all my credit history, which aside from the repo was good. now i keep a cash collateral loan running at all times. im almost back over 700 for a credit score after years of having nothing and basically starting over.

for those curious, pm me and ill explain my collateral loan that gains me 25 points a year on my credit. basically a cash collateral loan, and direct withdrawl, takes a half hour to setup and then i forget about it until its paid.

[bigred875]

i had a tacoma repo'ed about 5 years ago, i owed just under 18k on it, it sold for about 8k at auction. they badgered me for a short while and i sent the "collection" company a few hundred bucks after hearing threats of garnished wages and court, but then stopped paying them and never heard from them again. its on my credit report now as a "chargeoff" meaning i defaulted and didnt pay, and they know they arent getting any money from me.

i wonder if it was some kind of scam from a 3rd party trying to get money out of me but whatever, another year or two and its past the 7 year mark where it supposedly falls off your credit report. ill be keeping an eye on it.

comes down to i was naive and got kinda screwed into the loan, but i learned a few valuable lessons along the way.

1-i should never have signed the paperwork, much less left with the new truck instead of my old car.

2-after the repo i wanted no loans or anything which did more damage to my credit than the repo did, since i lost all my credit history, which aside from the repo was good. now i keep a cash collateral loan running at all times. im almost back over 700 for a credit score after years of having nothing and basically starting over.

for those curious, pm me and ill explain my collateral loan that gains me 25 points a year on my credit. basically a cash collateral loan, and direct withdrawl, takes a half hour to setup and then i forget about it until its paid.

charge off means they wrote the debt off not you don't have to pay. If you ever want to buy a house you will need to settle that debt...it will come back to haunt you in the future. Good news is they will settle for pennies on the dollar

[Pestilence]

charge off means they wrote the debt off not you don't have to pay. If you ever want to buy a house you will need to settle that debt...it will come back to haunt you in the future. Good news is they will settle for pennies on the dollar

NEVER EVER SETTLE!!! The LAST thing you do is settle, that PAID IN FULL tag line is nothing more than an agreance you faulted and will harm your credit more than do it good, THAT'S what will come back to haunt you for 7 yrs from the day you pay it off!!

After 7 yrs from the date of the final default, usually 120 days or the chargeoff date, it's gone from your report.. that is if you want to wait that long. If you play the game, which you should, you can have it removed in as little as 2 yrs. The trick to the game is when it goes to collection, ie your debt has been sold to a collection agency and the original creditor has written it off, the debt is gone. The agencies have no legal right to collect from you. It's all in the Fair Credit trade Act. Collection agencies are nothing but blood sucking fear mongers who will stop at nothing to get their money from you in every illegal way they can.
I know this as I went from a sub 300 score to over 650 and zero bad reporting in 4 yrs time.

[bigred875]

Nope! after 7 yrs from the date of chargeoff, it's gone from your report.. that is if you want to wait that long. If you play the game, which you should, you can have it removed in as little as 2 yrs. The trick to the game is when it goes to collection, ie your debt has been sold to a collection agency and the original creditor has written it off, the debt is gone. The agencies have no legal right to collect from you. It's all in the Fair Credit trade Act. Collection agencies are nothing but blood sucking fear mongers who will stop at nothing to get their money from you in every illegal way they can.

I know this as I went from a sub 300 score to over 650 and zero bad reporting in 4 yrs time.

usually when the debt is sold to another agency the clock starts over....and if you make a payment...over again... you played the system good, which is awesome. You're right the collection agencies break the law everyday because most don't report the crime and those that do rarely get enforced. unfortunately most don't play the game well...i'd love to hear how you worked it so yours were wiped out in 2yrs