30 day past due on trade-in

[Anonymous]

I traded my car in toward a new car. When i signed the DMV paperwork thatb transfered ownership of my car the finance manager told me not to worry about making the payment that the car was no longer legally mine. I just looked at my credit report and my score has dropped almost 70 points. I had paid on the loan almost 5 years with 1 late payment the first year and now the final payment was 30 days late due to car dealership. What should i do now that this has wreaked my score that i have been working on for 3 years.

[Anonymous]

1- is there a balance still owing on the loan (ie late fees)

2- Who is to blame? Did the dealership not send a check in time, did you trade the car too soon for a payment to be made (ie were you already behind when the trade in happened,) did the dealership pay the wrong account, did the bank credit the wrong account. Did you give the dealership the worng payoff?  many times if yo are within a week of a payment you will still be expected to pay the next payment as there is most delerships take a few days to get  a check cut and issued. Overpayments when all said and done are then refunded to you from your bank once it is all paid off.

3-The bank would not have released the title until all fees were paid, so someone at the dealership may have had to cut another check to get the title so they could resell the car. Without the title your car is a depreciating hulk.

4- Someone at the dealership is aware of the issue, you need to ask questions. Call the finance guy.

5- Assuming the error was not yours, Once you figure out where the error was it should be simple to get them to help you clear your report.

6-if no one takes the blame and you are not given clear reason to believe that you are the person at fault, ie youprovided the wrong accont info, you had a payment due that day, you had outstanding fees on the account that were not included in the pay-off balance you provided- if your score is that important- get a lawyer.

Yes it will cost you, you can probably recoup the money.

[d170]

Although you signed the car over to the dealership, you are still responsible for payment until it is paid in full.   That is a big misconception in regards to trading in a financed vehicle. 

[IOBA]

Definitely follow up  with the car dealership and your lender!

I have heard horror stories of people trading in their car for a new one.   They assumed that once they signed over the old car, the loan would be paid off.   Well, some of the dealers did not pay off the old loan....not until it was necessary or not at all.

There were horror stories of people purchasing the used car at the dealership, and then later it was repossessed by the lender who held the first note.   

You can probably google this stuff.  I don't remember when it was a big media item.

Call your lender and ask for the status of the "late" payment and ask for the current status of the loan.  If it has not been paid off, make whatever payments need to be made to bring it current and hire a lawyer.   You will need to go back to the dealership and recoup your money.   Also, go through your paperwork for the purchase of the new car.  Do you have a signed paper that says the dealership will pay off the old loan?

Good luck and please let us know how things turn out.

[Odiseous]

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@IOBA wrote:

Definitely follow up  with the car dealership and your lender!

I have heard horror stories of people trading in their car for a new one.   They assumed that once they signed over the old car, the loan would be paid off.   Well, some of the dealers did not pay off the old loan....not until it was necessary or not at all.

There were horror stories of people purchasing the used car at the dealership, and then later it was repossessed by the lender who held the first note.   

You can probably google this stuff.  I don't remember when it was a big media item.

Call your lender and ask for the status of the "late" payment and ask for the current status of the loan.  If it has not been paid off, make whatever payments need to be made to bring it current and hire a lawyer.   You will need to go back to the dealership and recoup your money.   Also, go through your paperwork for the purchase of the new car.  Do you have a signed paper that says the dealership will pay off the old loan?

Good luck and please let us know how things turn out.

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+1

I traded in my car a bit over a year ago. The dealer said they would take care of everyting. 

Being as I'm a bit *finicky* when it comes to someone else having anything to do with anything related to my CRs; I watched my loan balance like a hawk. 3 weeks later; I walked into the dealership; to see why it wasn't paid. As it turns out; the person that 'handled those transactions' had been out of the office due to sick / maternitity leave / whatever / doesn't matter (to the person with the loan). 

I handed the finance guy an updated payoff quote (printed out that morning); and politely informed him, that if my credit was negatively impacted in any way; I would be forced to take legal action. 

It was PIF within 2 days. 

The lesson I learned: Be pro-active with the dealership. You have a contract. If they fail to act, confront them (nicely, of course).

[IOBA]

Way to go Odiseous!

I can say that I have been blessed.  The last time I was in that boat was in 80's...And all we did was transfer the loan from one car to the other.  (Long story.)

Since then, starting in the 90's, I paid cash for every car.   I live in a county that is ferocious and rabid about taxes, so I do a follow up to make sure the title has been transferred out of my name when I trade in a vehicle.  I think there is a form that I can also turn into the county that shows I sold the vehicle.

Some dealerships wait until they sell your trade in to someone else before doing a title transfer.   It saves the dealership the hassle and the expense of transferring a title twice.   Always worth following up on!