My question involves an auto loan or repossession in the State of: Alabama.
In 2008 my husband and I were splitting up. I needed cash to get into a place of my own, so I took out a title loan on my car for about $400. Two months in I was late on a payment (just needed to wait until I got my paycheck) and they came out to repossess my vehicle. Unfortunately for them they went to my husband's address and (of course) the car wasn't there. He called and told me they'd come to repo, and I made the missed payment as soon as I got my check. Several months later I lost my job and couldn't make my payment, so the loan company advised me to do a "re-advance". They plugged into their computer that I'd made a payment, cut me a check for another $400, and then followed me to the bank so I could cash the check and give them the cash they'd already told the computer I paid. I had trouble finding work and had to do this "re-advance" several months in a row, until I was in debt to them for $2080. I always paid back the excess cash the following day.
For nearly 2 years I made the payments on time and as stated in my loan contract. I paid $245/month. All told I repaid them more than $6500 on the $2080 I'd borrowed. When I finally thought to ask how many more payments I had left, they said I still owed them $2080 and that all this time I'd only been paying interest on the loan!!
I sat down and did the math, and discovered that even though the stated interest rate on my loan was 1.21%, I'd paid them far, far more. I sent a certified letter to the location where I obtained the loan and to the corporate office stating that I thought this was predatory lending and disputing the debt. At that point I'd lost my job again and hadn't made the monthly payment, they were telling me that I had to pay the full $2080 or voluntarily surrender the vehicle. I offered to make cash payments in good faith, knowing that it wouldn't prevent repossession/collection action, but I'm not the type who bails on my bills. They refused to take a single cent. I got a letter back from the corporate office stating that I needed to speak to the District Manager. Sent another certified letter asking for his contact info and never got a response. Called the loan location and got the same tired line: surrender the car or else.
I decided that I'd done my part: I paid them back three times what I'd borrowed, I'd offered to keep making payments, and I'd asked for an explanation as to why I hadn't satisfied my part of the bargain. They didn't respond to my letters, they stopped calling, and the only thing they'd tell me when I called them was that I had to pay the $2080 or come down and give them the car. I haven't heard from them in almost a year. There's nothing on my credit and they've not filed anything in court.
Two weeks ago the car in question suffered a catastrophic mechanical failure. It needs a new engine and it will cost more to fix than what the car is worth. In its current condition the car is worth less than half of what the title company wants me to pay for it. If I sell it for scrap I could probably get between $200 and $400 for it.
So, after all that info, here are my questions:
1. I feel like the title loan company did something shady, maybe not-quite-legal. Did they? Would it be worth my time to contact an attorney with it?
2. Does anyone know how it's possible to make your payments on time, as scheduled, and not make a dent in your loan?
3. Is it possible to sell the car for scrap without a title? Would I face criminal charges for it? I've already paid the loan company too much, and I could really use the scrap value towards something to drive, but it's not worth catching a charge.
Thoughts and info are greatly appreciated.