My daughter is 19 years old. We helped her save $2,000 to purchase a car with. She found a car she liked and went to purchase the car while we were both at work. At some point, she lost focus and wound up at a buy here, pay here place. Ultimately, she signed a contract to pay $8500 for a car blue-booked at $3200 (not including the 25% interest rate). That amount 'financed' is after the $1500 she gave them as a down payment. So, $10,000 in total. She, thankfully, purchased the collison/gap coverage. On Nov 4th, she had an accident which deemed the vehicle a total loss. She then made an additional loan payment on the car on Nov 7th. The "insurance" company paid $2362.50 towards the vehicle loan on 11-24. The buy here, pay here place then gave the title/car to the towing place to "settle the bill". The documents we have state the "Limit of Liability" of the insurance purchased is LOAN AMOUNT not vehicle worth. We've sought out an attorney to fight for the remainder owed on the loan. That's not the bigger issue. The buy here, pay here place reported the loan as a charge off to all credit agencies in November.... Same month as the accident and receiving $2462.50 in payments on the loan. Which is equivilent to 7 months of payments. Then, they filed a 1099-C for 2014. Everything I'm reading shows a loan has to be 120 days in default before a charge off is legal and that a charge off has to be in effect before the 1099-C can be filed. Does anyone have any information in regards to how we fight this?
