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  1. #1
    Join Date
    Jan 2012
    Posts
    23

    Default Dealer Financed Vehicle Through the Wrong Lender

    My question involves a consumer law issue in the State of: Ca

    Okay, so I went to buy a new car and informed the dealer I was approved for a loan with a certain bank that I have not accepted. They said they will work with that bank and will coordinate the loan paperwork since I was already approved for convenience.

    After the car purchase I get a letter from a different bank for payment and needless to say I was furious. They are trying to give me car accessories to look the other way to deal with the different bank. Granted the rates are the same, but they screwed up with my loan and gave my personal info to another bank. They are slacking in rectifying the situation and I am losing my patience. I am so frustrated that I am thinking about lawyering up and suing them for gross negligence.

    In addition, I bought an extended maintenance warranty that I paid in full and later requested a refund. Their response was the refund will go the bank and will be applied towards my principal. I don't get why they would send my refund to the bank since the warranty is not part of the loan and I had to increase my down payment to pay for it in full?

    Please let me know what my options are? Or am I overreacting? Thanks.

    - - - Updated - - -

    And get this, my new plates come in and on the registration it says a third bank?!

    My bank approval was with my credit union, then they screw up and setup the loan with Bank of America, but the lien holder shows BK of West, which is a completely different bank!

  2. #2
    Join Date
    Jan 2006
    Posts
    38,867

    Default Re: Dealer Used Wrong Bank Loan

    Okay, so I went to buy a new car and informed the dealer I was approved for a loan with a certain bank that I have not accepted. They said they will work with that bank and will coordinate the loan paperwork since I was already approved for convenience.

    After the car purchase I get a letter from a different bank for payment and needless to say I was furious. They are trying to give me car accessories to look the other way to deal with the different bank. Granted the rates are the same, but they screwed up with my loan and gave my personal info to another bank. They are slacking in rectifying the situation and I am losing my patience
    why didn't you simply sign to purchase the car and you go and obtain the loan from the lender of your choice?.
    I am so frustrated that I am thinking about lawyering up and suing them for gross negligence.
    You really have no idea what you are talking about with this.

    In addition, I bought an extended maintenance warranty that I paid in full and later requested a refund. Their response was the refund will go the bank and will be applied towards my principal. I don't get why they would send my refund to the bank since the warranty is not part of the loan and I had to increase my down payment to pay for it in full?
    because unless you paid cash for the warranty, it is within the loan and it rightfully should be refunded to the bank since the loan amount was premised on that money being within the loan.

    Or am I overreacting?
    yes


    Of course unless your contract stated your loan would be sourced from a particular lender, they dealership has no obligation to do so. What is a bigger question is; if you had already applied for the loan with the credit union and been approved, why would you fill out any loan applications with the dealership?



    .

  3. #3
    Join Date
    Jan 2012
    Posts
    23

    Default Re: Dealer Used Wrong Bank Loan

    Quote Quoting jk
    View Post
    why didn't you simply sign to purchase the car and you go and obtain the loan from the lender of your choice?
    First time buying a new car, and they said not to worry about the hassle of going back to my credit union and they would take care of it for me since it is part of their customer service. In retrospect of course I would do it differently now. They ran my credit without my knowledge, but they did ask for my personal info and I was naive enough to hand it over.

    Quote Quoting jk
    View Post
    You really have no idea what you are talking about with this.
    Pretty much, which is why I am here, just frustrated with the ordeal.


    Quote Quoting jk
    View Post
    because unless you paid cash for the warranty, it is within the loan and it rightfully should be refunded to the bank since the loan amount was premised on that money being within the loan.
    As stated I paid in full for the warranty and put a higher down payment because of it.

    Quote Quoting jk
    View Post
    yes


    Of course unless your contract stated your loan would be sourced from a particular lender, they dealership has no obligation to do so. What is a bigger question is; if you had already applied for the loan with the credit union and been approved, why would you fill out any loan applications with the dealership?
    My contract does not have any lender's name, and they admitted to screwing up because it was in their notes and passed it off to another finance person who did the wrong loan. I came in with bank A, they loaned me out to bank B and my registration says lien holder is bank C. Comical and frustrating I tell ya. Do I have any legal recourse I can threaten with if they do not fix this mishap? First payment is due in 2 weeks and they have been slacking with rectifying the situation. What is your advice? Thanks for your time.

  4. #4
    Join Date
    Oct 2006
    Posts
    16,474

    Default Re: Dealer Used Wrong Bank Loan

    Quote Quoting Smee
    View Post
    First time buying a new car, and they said not to worry about the hassle of going back to my credit union and they would take care of it for me since it is part of their customer service. In retrospect of course I would do it differently now. They ran my credit without my knowledge, but they did ask for my personal info and I was naive enough to hand it over.



    Pretty much, which is why I am here, just frustrated with the ordeal.




    As stated I paid in full for the warranty and put a higher down payment because of it.



    My contract does not have any lender's name, and they admitted to screwing up because it was in their notes and passed it off to another finance person who did the wrong loan. I came in with bank A, they loaned me out to bank B and my registration says lien holder is bank C. Comical and frustrating I tell ya. Do I have any legal recourse I can threaten with if they do not fix this mishap? First payment is due in 2 weeks and they have been slacking with rectifying the situation. What is your advice? Thanks for your time.
    First, you need to understand that banks (and even credit unions) who make car loans often sell those loans off to other banks shortly after making them. Therefore, that is normal and legal and there is nothing that you or the dealer can do about that.

    I also do not believe that the dealer is able to "rectify" the situation at this point. I don't believe that there is any method for them do undo this.

    You should also be aware that although you added additional down payment money to cover the extended warranty, its unlikely that you paid for it separately. It just doesn't work that way. Example: 20k car plus 2k extended warranty = 22k. You make a down payment of 5k leaving a balance of 17k which is financed. Therefore, its appropriate that any refund goes to the bank to pay down the principal.

    I really think that you are stuck with the situation as it is. I think that the dealer is offering you accessories because there is nothing else the dealer can do.

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