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  1. #1
    Join Date
    Feb 2017
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    5

    Default Bank Closed My Car Loan Account and Sent Me My Title by Mistake

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

    My bank recently closed my loan. They put in they received a payment on 01/25/2017 for the full amount. I received a letter from them dated 01/30/2017 thanking me for my business and that my car was paid in full and my title was in the mail. I received that on 02/03 in the mail. But prior to me receiving it that day I called to find out why my account was closed. I kept being told it was paid off. Then some guy got on the phone saying he was the president of that department and he didn't know why my loan was closed. He said they showed a payment made on the 25th with no notes. He said he would call me back that day. But that I will most likely still have to pay and that it was an error.I have yet to hear back. I have since received my title in the mail on 02/06/2017. My questions are:

    1. In Arizona dmv holds your title if you have a lien. I now have the lien and a letter from the bank stating it has been paid off. Does this void the original loan since they closed the account and sent me these documents?

    2. Could I dispute this in court since I did contact them and never heard back and have those documents?

    Thanks...

    Sorry it was supposed to say I now have the title not the lien

  2. #2
    Join Date
    Sep 2005
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    Default Re: Bank Closed My Car Loan Account and Sent Me My Title by Mistake

    You still owe the money. They accidentally released their lien, but that has no impact on your contract to repay the money that you owe. If they sue you, they will get a judgment for the money that you still owe.

  3. #3
    Join Date
    Feb 2017
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    5

    Default Re: Bank Closed My Car Loan Account and Sent Me My Title by Mistake

    They didn't accidently close it. They insisted they received a payment in full. Would look into it and call me back that day. I have yet to hear from them and that was last week. I would think since they have closed the account and sent me a letter stating its been pAid in full and there is no longer a lien on my vehicle this would void any contract we had.

  4. #4
    Join Date
    Oct 2006
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    15,988

    Default Re: Bank Closed My Car Loan Account and Sent Me My Title by Mistake

    Quote Quoting Mr. Knowitall
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    You still owe the money. They accidentally released their lien, but that has no impact on your contract to repay the money that you owe. If they sue you, they will get a judgment for the money that you still owe.
    There is some very slight chance that it was not a mistake. Someone might have actually paid off the OP's loan. There was no indication that the amount paid off was not the exact amount owned therefore the odds of the bank accidentally crediting the wrong account lessens. I think that the greater error possibility is that someone called in to pay off a loan, and transposed some numbers or something therefore giving OP's account number instead of the one intended. That get really messy.

  5. #5
    Join Date
    Feb 2017
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    5

    Default Re: Bank Closed My Car Loan Account and Sent Me My Title by Mistake

    I spoke with the attorney generals office consumer affairs office and although they cannot give legal advice they were unsure what to do. In Arizona once you receive your title and a letter from the bank stating your loan is paid off the vehicle is now yours. They said they have never had a case like this. She said I could file a complaint and they could contact them on my behalf and they would put it in writing but I'm not so sure I want to push the issue.

  6. #6
    Join Date
    Mar 2013
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    17,616

    Default Re: Bank Closed My Car Loan Account and Sent Me My Title by Mistake

    You need to understand that the car was the security for the loan.

    Now the loan is unsecured but the loan is still enforceable.

    At some point the bank people will figure out the mistake and credit the funds to the proper loan and come to you for the payment.

    You had best be prepared for that day and take the amount of your payments and put them aside and don't spend the money.

    A basic part of contract law says that you cannot profit from the other party's mistake or breach.

  7. #7
    Join Date
    Feb 2017
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    5

    Default Re: Bank Closed My Car Loan Account and Sent Me My Title by Mistake

    Thanks for the response. I spoke with a consumer attorney and as I thought it voids the contract for the vehicle. You are correct that it now makes it an unsecured loan and they have to go to court to get that loan they cannot just make a new contract. Because I have a document with them acknowledging the lien has been lifted dated 7 days after they claim the payment was made goes in my favor for the auto loan portion. Again, you are absolutely right that they can file in the superior court for a unsecured loan. I owed three times the amount the car was worth and had paid on it for 2 years and it only went down 1000 dollars. The civil courts here only go up to 3000 so this will go through the superior court. Sigh... But they cannot go for back payments. If granted in the court payments start from that day.

  8. #8
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    Default Re: Bank Closed My Car Loan Account and Sent Me My Title by Mistake

    You owe them money under your loan contract, including interest, late fees and penalties if you don't make your payments on time. They can sue you for all of the money that you owe.

    You don't have to contact them -- you can wait and see if they notice a problem; but they have six years to sue you.

  9. #9
    Join Date
    Mar 2013
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    17,616

    Default Re: Bank Closed My Car Loan Account and Sent Me My Title by Mistake

    Quote Quoting Cowgirlup96
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    I owed three times the amount the car was worth and had paid on it for 2 years and it only went down 1000 dollars.
    That's not the bank's fault. It's your fault for making a bad deal on the purchase and on the loan.

    The civil courts here only go up to 3000 so this will go through the superior court.
    Your loan contract almost certainly has a bilateral attorney fee provision that says something like "in the event of litigation, loser pays winner's attorney fees."

    If this has to go to court, you'll be adding thousands of dollars to the debt to pay the lender's attorney.

    Again, I strongly suggest you put your payments aside and don't spend the money. That way, you'll have the money when the bank inevitably fixes the mistake and asks you for the money.

    You should also know that if you have your savings and checking accounts in the same bank, the bank can take the money out of those accounts under its Right of Set Off (read your loan contract and your other account agreements).

  10. #10
    Join Date
    Jan 2010
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    New Jersey
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    3,656

    Default Re: Bank Closed My Car Loan Account and Sent Me My Title by Mistake

    Quote Quoting Cowgirlup96
    View Post

    My bank recently closed my loan. They put in they received a payment on 01/25/2017 for the full amount. I received a letter from them dated 01/30/2017 thanking me for my business and that my car was paid in full and my title was in the mail. I received that on 02/03 in the mail. But prior to me receiving it that day I called to find out why my account was closed. I kept being told it was paid off. Then some guy got on the phone saying he was the president of that department and he didn't know why my loan was closed. He said they showed a payment made on the 25th with no notes. He said he would call me back that day. But that I will most likely still have to pay and that it was an error.I have yet to hear back. I have since received my title in the mail on 02/06/2017.
    See what happens when you shake the tree?
    I'm not a lawyer, but I did stay at a Holiday Inn Express last night.......

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