Ally is not your ally

Anonymous · ‎08-23-2015

In Feb 2012, I bought a used Ford Edge for about $20k. Made every payment on time. Relocated to a very rural address, and it was too expensive to drive for my regular commute ($25 gas a day), so I parked it at the house, let the insurance lapse, and only rarely drove it. A former coworker and friend badgered me for a month to borrow it to move ssome of his stuff to a new apartment in the same town. Finally let him; fast forward a week later, still haven't heard a word from him, no answers to calls/texts. Finally his girlfriend answered the phone and was like "what you didn't know? he totalled it in Gulfport (90 miles away) and is in the hospital, then being released to jail." Bummer for me. This was Sept 2014.

Ally picked up the remains of the vehicle from the tow lot. I quit paying the note, they auctioned the remains and applied the proceeds t the note, which left $13k due. Filed for Ch 7 two weeks ago as I received a bill for $21k in damages for the other injured party (! - I know now more about liability laws). Just noticed though that Ally has deleted their entry in my credit reports for a vehicle loan showing 2.5 years of perfect payment history, and replaceed it with a collections entry for the $13k. While i realize that the bk will change the amount reporting to $0, but can they really just delete accurate information about an account in favor of a reported collection??? I will be needing another vehicle as soon as I get the discharge, and was banking on showing the car note (plus a previous car note that was paid perfect/in full) as Paid as Agreed in negotiating terms.

Am going to try to convince our credit union to add our other car's loan info (my partner and I cosigned for it but then they wrote the loan on him only - he didn't pay on time a few times, found out, and took over making his payments and since then perfect payment history, reaffirmed in bk) to my reports, but am concerned that a) lenders will see a period of 6 months or so with lousy payment history from early 2014, and b) the late payments will further damage my scores EQ 492 EX 603 TU 492.

gdale6 · ‎08-23-2015

Sure they can delete the payment history if they want and say its in collections they dont have to report it at all but what they do has to be accurate. I would not be trying to add a note that has lates and if your name isnt on it its not going to happen unless its refinanced into your name or both names.

pipeguy · ‎08-23-2015

I really don't mean to pile on, but it seems you made some bad choices here between lending your car to someone, then to STOP paying on the note when it went south - lending your car is a choice that turned out bad (your fault), not the accident, but the choice to lend unpaid for property with the liability - to choose to stop paying the note is completely your fault.

That being said, I don't see where the lender (Ally in this case) is doing anything wrong by reporting the current snap shot of the loan. If the lender stated "borrower paid on time for 2 years then defaulted with no payments since and has filed bankrupcy" - your score and report would be the exact same. Credit for keeping your end of a loan only goes as far as when you default on the loan - to other lenders, looking at a currently snapshot of your worthiness for future loans or credit - you are in default.

Bankrupcy is a fresh start, but be ready for a lot of rejection and poor lending interest rates, at least for a couple of years.In the case of bankruptcy, your history will haunt you more than your current snapshot, at least for a couple of years.

Anonymous · ‎08-23-2015

I undestand you trying to shift the blame, but one of the things you promised to Ally (or any lein holder) is to keep full insurance on the vehicle. They could have come after you at any time for letting your insurance lapse. Sorry for your issues, but I don't see Ally at any fault here.

Anonymous · ‎08-23-2015

@Anonymous wrote:
I undestand you trying to shift the blame, but one of the things you promised to Ally (or any lein holder) is to keep full insurance on the vehicle. They could have come after you at any time for letting your insurance lapse. Sorry for your issues, but I don't see Ally at any fault here.

I have to agree. So sorry you are going through this.

Anonymous · ‎08-23-2015

Thank you everyone for your responses. The reason I moved was because I became disabled and the bankruptcy happened regardless of the accident as I defaulted on all debt except the car payments and student loans (in deferrment, pending disability discharge). On set income, it becomes a game of "do I eat and pay for doctors and prescriptions, or do I pay debt/insurance/things I should be able to pay but all of a sudden can't..." I kept the car note current to keep from it being repossessed, and maintain a good trade line. About to graduate with a bachelor's (decided to finish school), but then will be most likely applying for the discharge as it will be awhile yet before I can go back to work. At least now I will have the degree and a couple years will have passed for my credit to rebuild some so I can get back to work on much better footing.

I will say, lesson learned, no matter what or who, I do not loan out my vehicle.

Anonymous · ‎08-23-2015

bdh1975 - add to the list ... "no co-signing" for loans. Isn't it amazing how our friends disappear?

Anonymous · ‎08-23-2015

@Anonymous wrote:
Thank you everyone for your responses. The reason I moved was because I became disabled and the bankruptcy happened regardless of the accident as I defaulted on all debt except the car payments and student loans (in deferrment, pending disability discharge). On set income, it becomes a game of "do I eat and pay for doctors and prescriptions, or do I pay debt/insurance/things I should be able to pay but all of a sudden can't..." I kept the car note current to keep from it being repossessed, and maintain a good trade line. About to graduate with a bachelor's (decided to finish school), but then will be most likely applying for the discharge as it will be awhile yet before I can go back to work. At least now I will have the degree and a couple years will have passed for my credit to rebuild some so I can get back to work on much better footing.
I will say, lesson learned, no matter what or who, I do not loan out my vehicle.

Good policy. And if by chance, I do decide to loan it out, I go with it, and I do the driving.