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  1. #1
    Join Date
    May 2019
    Posts
    12

    Question Bank is Refusing to Pick Up a Vehicle

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

    Long story short, my wife and I decided to surrender our vehicle. We have not filed bankruptcy and have zero intention to do so. The car has tons of problems. We requested the lienholder come repo the car. It's one of those BHPH banks. The lot where the vehicle was purchased is no longer here. The lienholder is refusing to pickup their car and requested photos and offered a settlement in exchange for the title. We owe about 5k on it, and the car is worth around 1200. Bank is out of Dallas, TX and I am in FL. The bank stated to "Make an Offer". The amount I threw to him was $500 and the rep stated he would send me a settlement offer letter. I intend to either fix and sell or part out the vehicle.

    My question is, does this seem sketchy or does this actually happen?

    (Please no "it will destroy your credit to surrender" posts. We are aware of this.)

  2. #2
    Join Date
    Sep 2010
    Posts
    19,060

    Default Re: Bank Refusing to P/U Vehicle

    The bank is under no obligation to repo the vehicle. In fact, given how upside down it is, there's not much point. They don't want to be stuck with you junker any more than you do.
    Feel free to negotiate. The damage has already been done if you are in default of your loan.

  3. #3
    Join Date
    Jan 2006
    Posts
    38,648

    Default Re: Bank Refusing to P/U Vehicle

    A lender has no obligation to pick up the car. There is no obligation they do anything except accept payments from you.

    its actually pretty simple; you borrowed money. A lien was placed on the car to secure it so it couldn’t be sold without paying off the loan. You haven’t paid the loan so the lender will expect you to continue paying until the loan is repaid.

    If you refuse to make your contracted payments, The lender can sue you to obtain a judgment for the full amount owed and chase you for many years (would have to research the statute of limitations on a judgment). (And they still wouldn’t be obligated to pick up the vehicle which means you could get stuck with a car you technically don’t own sitting on your property)

    Even if they did accept the car as a repo, you would still owe whatever the difference is between the amount they receive when auctioning the car and what you currently owe.

    There really is no escape here for you other than continuing to attempt to negotiate a reduced payoff for the loan. Given it’s worth about $1200, it wouldn’t make sense the lender accept anything less than the car is actually worth since they would receive that much if they auctioned in, and you would still owe the balance.

  4. #4
    Join Date
    Oct 2006
    Posts
    15,435

    Default Re: Bank Refusing to P/U Vehicle

    Its not sketchy at all. You purchased a used car that apparently wasn't worth a whole lot to start with, and it would cost the bank more to collect and deal with the car than it's worth.

  5. #5
    Join Date
    May 2019
    Posts
    12

    Default Re: Bank Refusing to P/U Vehicle

    jk,

    Im not sure you understood what I was trying to ask. They agreed to settle the account completely for a mere $500 on the $5000 balance. I just wanted to make sure it wasnt a scam.

  6. #6
    Join Date
    Jan 2006
    Posts
    38,648

    Default Re: Bank Refusing to P/U Vehicle

    Quote Quoting dgreco49
    View Post
    jk,

    Im not sure you understood what I was trying to ask. They agreed to settle the account completely for a mere $500 on the $5000 balance. I just wanted to make sure it wasnt a scam.
    youre right, I didn’t understand your question.

    Did that include a release of the lien?

    make sure the contract states it is accepted as payment in full. Make sure you make copies of everything they sent you that you have to return (like a signed contract) and copies of everything you send them. Retain this stuff for years in case somebody somewhere tries to argue you still owe money

    after a few months start checking to be sure this is properly reflected on your credit reports. It will likely show this was a “accepted payoff less than balance in full” with the balance remaining owed showing $0.

  7. #7
    Join Date
    May 2019
    Posts
    12

    Default Re: Bank Refusing to P/U Vehicle

    Yes. Lien release with paper title sent in mail. Hes supposedly sending me a settlement letter today.

  8. #8
    Join Date
    Jan 2006
    Posts
    38,648

    Default Re: Bank Refusing to P/U Vehicle

    Quote Quoting dgreco49
    View Post
    Yes. Lien release with paper title sent in mail. Hes supposedly sending me a settlement letter today.
    Read everything throughly. It sounds like you may have won the lottery.

    Be forwarned; this can have (income) tax implications. You are essentially being given $4500 and this could be (should be) reported to the irs as a cancellation of a debt. If I recall correctly Florida doesn’t have a state income tax so it won’t affect you at a state level.

  9. #9
    Join Date
    May 2019
    Posts
    12

    Default Re: Bank Refusing to P/U Vehicle

    Quote Quoting jk
    View Post
    Read everything throughly. It sounds like you may have won the lottery.

    Be forwarned; this can have (income) tax implications. You are essentially being given $4500 and this could be (should be) reported to the irs as a cancellation of a debt. If I recall correctly Florida doesn’t have a state income tax so it won’t affect you at a state level.
    We wound up settling @ $650. Title is being sent out.

  10. #10
    Join Date
    May 2019
    Posts
    1

    Default Re: Bank Refusing to P/U Vehicle

    We require that the request for the title come from the DMV, and then we will send it straight to them. We will not release our lien on the title, nor will we release the title directly to the customer. Most states I've worked with already have a letter to request the title from a lien holder.

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