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Finance Company Bought Contract from Dealer, Now is Saying New Terms

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  • 04-01-2013, 11:47 AM
    birdinatux
    Finance Company Bought Contract from Dealer, Now is Saying New Terms
    My question involves a consumer law issue in the State of: Minnesota


    I bought a car from a local auto company. My contract with them requires me to carry LIABILITY insurance. I have made on time payments for about a year. Well recently a company called Mid Atlantic Finance bought the contract from my dealer.

    They are now telling me that they require full coverage insurance and if I don't show proof they will add it to my payment. What can I do here? I did not ask them to buy the loan it was just done. One day my automatic payments stopped and I was told I have to pay these people now. Please help

    Thanks in advance for any advice,

    Brian
  • 04-01-2013, 01:07 PM
    jk
    Re: Finance Company Bought Contract from Dealer, Now is Saying New Terms
    Read your contract, thoroughly. Make sure all it requires you to carry is liability insurance. Now, you must realize that that is extremely unusual and in reality, makes no sense since your liability issues have no bearing on them. Lenders almost always require a debtor to carry insurance to cover the secured property.

    Are you sure it is not written that you will carry insurance to cover your liability to the lender for the amount owed on the vehicle?



    If all it requires you to carry is liability insurance (the liability you would incur to others when driving the vehicle), then photocopy the contract, highlight the section and send it, along with a letter stating your contract does not require you to carry any insurance other than owner's liability insurance. You can continue on that as a purchaser of the contract, they are bound by the same terms the original party they are replacing was.

    one other thing to look into: does your contract provide for the contract to be sold such as it has?
  • 04-01-2013, 02:08 PM
    birdinatux
    Re: Finance Company Bought Contract from Dealer, Now is Saying New Terms
    I just got off the phone with the finance company again. After 3 different "supervisors" I was able to get the to notate the account to quit harassing me about insurance. I have it in my contract with the original seller that I am only required to carry liability insurance. (They do this for certain vehicles under a certain price). Thanks for the reply and mentioning to look and see if they can even sell the contract. That will be looked into when I get home. Thanks!!

    Brian
  • 04-01-2013, 02:57 PM
    jk
    Re: Finance Company Bought Contract from Dealer, Now is Saying New Terms
    It sounds like they could be acting on "typical" requirements in such a contract. As such, they are simply acting as programmed rather than because your contract required the insurance. Hopefully you have been successful in them adding a notation to your file that makes it such they will not continue to call for that reason. If not, about all you can really do is go through the motions, again.


    The funny thing about supervisors at collection companies or some loan companies (such as the one you are dealing with):

    they could be the guy sitting next to the guy are talking to and tomorrow, the guy you are talking to today is the "supervisor" for the guy that played supervisor yesterday.

    Get names and keep a file handy so you can tell the next yahoo who the supervisor was that you talked to and cleared it up the time before.
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