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#26659 - 08/02/02 08:25 PM FDCPA--i have a scenario i need an opinion on
Anonymous
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i'm not even sure if fdcpa applies but please, ANY clarification i can get would be greatly appreciated!

quick synopsis of the story:

customer signs contract for auto loan and after having made payments for about 2 years finds himself falling on hard times. he contacts finance company and tells them this.

he arranges to surrender the car post haste. at this point there is still a balance on the original note in excess of 15000.

said finance company turns around and sells said car for SIGNIFICANTLY LESS than that balance on the contract. alas, they sold it for less that kelley blue book value! (around 3000--if you can believ that!)

said finance company is now in the process of garnishing what little wages the aforementioned customer has coming in at the moment for what will end up being in excess of 13000. thus he is still locked into the remainder of a 5 year contract, making payments on a car he doesn't even have any more.

my question is this: is there something wrong with this picture or what?

i seem to recall that there are limits to what the finance companies can go after in similar situations. in this case, they willingly, deliberately, knowingly sold off the car in question for far less than they knew it was worth and they still expect the original purchaser to give them the full five years worth of interest. i just think this whole thing is wrong--certainly morally. possibly legally--that's why i am asking before i tell my brother in law to call a lawyer.

if it helps, he lives in iowa.

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#26660 - 08/02/02 08:31 PM Re: FDCPA--i have a scenario i need an opinion on
1 Peter 5:7 Offline
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1 Peter 5:7
Joined: Jun 2001
Posts: 1,339
TX
He should probably make the call. A lawyer can tell him if the finance company was actually out of bounds. BTW, the FDCPA doesn't apply to this situation, it is a matter of state law and governed by Article 9 of the UCC or a state consumer credit code. Every state has heaps of case law on this very subject of collateral sales and deficiency judgments. Good luck!
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#26661 - 08/02/02 08:39 PM Re: FDCPA--i have a scenario i need an opinion on
Andy_Z Offline
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I agree with Ken. The question doesn't surround FDCPA, but whether the sale was fair and reasonable. Was it sold with only one bid, to an insider or relative, was the car damaged, totaled at one point, have an interior (yes, I've repo'd a car with only a driver's seat, a steering wheel and a stick shift. I could see the pavement thru the place the center console was supposed to be). There are too many unknowns in the question to say if a deficiency of this size is reasonable or not.
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My opinions are not necessarily my employers.
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#26662 - 08/02/02 08:50 PM Re: FDCPA--i have a scenario i need an opinion on
Anonymous
Unregistered

thank you both! and i realize that there are a lot of "unknowns" here but i was basically looking for a quick and dirty answer. so how about if i give you a little more to work with....

the car has never been in an accident, had reasonable mileage for being driven for about 2 years, and please assume that the car was in what kelley blue book would call good condition.

as far as who it was sold to--i haven't a clue.

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#26663 - 08/02/02 08:52 PM Re: FDCPA--i have a scenario i need an opinion on
Anonymous
Unregistered

also--one more question i thought of.....

is there a specific state agency i can tell him to call to ask about this?

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#26664 - 08/02/02 09:07 PM Re: FDCPA--i have a scenario i need an opinion on
Andy_Z Offline
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Andy_Z
Joined: Oct 2000
Posts: 27,546
On the Net
The State Attorney General or whomever regulates the lender is the one to call.

Repo'd cars hardly ever sell for book, so accept that in the first place. The lender/collector was attempting to dispose of collateral, not get the best price for the borrower. But it doesn't sound as though they did their employer any favors if the car was sold grossly under its actual cash value. The condition of the car and its true value need to be weighed against the sale, in my opinion. And I would enlist the assistance of one of these agencies to help determine what happened.
_________________________
AndyZ CRCM
My opinions are not necessarily my employers.
R+R-R=R+R
Rules and Regs minus Relationships equals Resentment and Rebellion. John Maxwell

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#26665 - 08/02/02 09:22 PM Re: FDCPA--i have a scenario i need an opinion on
Anonymous
Unregistered

thank you so much!

i'll tell my brother in law to make some inquiries!

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#26666 - 08/02/02 10:44 PM Re: FDCPA--i have a scenario i need an opinion on
SJB Offline
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SJB
Joined: Jun 2002
Posts: 1,210
California
Repo companies sometimes screw up on the notices and publications they have to give the owner vis-a-vis private vs. public sale, etc. under UCC Art. 9. If they didn't go by the book (UCC, not Kelley) they could be precluded from collecting a deficiency. Have your brother in law gather up every piece of paper he has recieved from the repoman, write out a detailed chronolgy and then spend a few bucks to talk with a reputable debtor's attorney.
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