Auto loan horror stories

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Names have been masked to protect the ghoulish

  • The automobile dealership representative attempted to secure a loan for my elderly mother’s car through several financial institutions. As her credit history apparently left a lot to be desired, I, as a good son, co-signed a note with her. Although I make $100,000 a year, have excellent credit, many of the institutions refused to take on the loan and subsequently sent refusals.

    Just a scant few days later, several of those same financial institutions began calling and sending literature wanting me to accept a pre-approved credit card! They also wanted me to put MY money in their institutions. They want my business now?!! I don’t think so … no thanks!!!

  • I once received an early morning phone call from the bank that financed my automobile. The bank representative told me he was holding my check for that month’s car payment in his hands and it looked like it had been run over by a train. He asked me to send him a new check that day to avoid a late payment. He said he would return the damaged check to me. Of course, I did what he asked and the next thing I knew, I had other checks started bouncing.

    He had deposited both checks and a double car payment had been deducted from my checking account. When my checks were returned to me with the bank statement, the first check I had sent was in pristine condition — hardly looking like it had been run over by a train. When I called the bank, they had no record of a representative having called me and refused to reimburse me for the bounced check charges. Yes, both payments were applied to my account and I could never determine a motive for what the bank representative did.

  • I purchased a van for $19,000. No big deal, the payments [stretched] over 5 years for $420 a month at 11.1 percent, starting on the 31st of the next month. I’m only 21, my credit isn’t great, but what can you do. Anyway, they gave me the car, I signed the paperwork, my mom co-signed and I drove it home. So, I DROVE IT HOME. IT WAS MINE. ALL PAPERWORK COMPLETE.

    Three days later, the bank I was supposed to send payments to says my loan was turned down. I guess I was excited considering I was already given the car and now didn’t have any bank to make the payments to. I left for school, assuming there was a mix up. I drove from Pennsylvania to school in Stanford, Calif. The van broke down in Arizona and it cost me a $100 deductible of warranty and took 14 days to fix. About three weeks after the purchase, I got a letter saying my payment was $489 with 17 percent interest! That’s $70 more per month than what I agreed upon when buying the van. This must be against the law or something.

  • I had a loan on a car. When I got married and asked the bank to change my name on the paper work, they wanted me to start the note all over again. This included paying ANOTHER $100 loan origination fee — just to change my last name!!!
  • I had a car loan and a checking account with
    Gremlin Bank.

    I was paying ahead on my car and the bank was repeatedly losing my payments. I had to keep after them so that it would clear. I then made a deposit and prepayment on the same day. Of course, the deposit did not go through until the check cleared, which caused my check to bounce. I had them credit me the fees and asked if the loan department would try to run the check through again. I was told no, so I wrote another check.

    The loan department then put both of the checks through and, of course, reduced my account balance to nothing. I was asked if I wanted them to return the money and I said no because the car was paid off (In fact, they owed me $73 for overpayment). I closed the car loan and received a reimbursement for $73 and my title in the mail.

    Everything was hunky-dory until three months latter when I received an overdue notice for $1,500 plus interest for my car loan. I already had the title to the car! It took two weeks to clear up the mess. I promptly closed my account and moved to another bank. I now have a mortgage, checking and savings account with the new bank. I cannot believe [my old bank] keeps getting bigger — only the bad get bigger. They only focus on the big business customers and don’t care about the individual.

  • I have an awful horror story dealing with an auto loan. I bought a brand new car right off the lot. Never did I dream it would turn into a seven-year nightmare.

    First of all, the car was stolen, and was not recovered for six months or so. It was finally found completely stripped — it was a total loss. The insurance company settled the claim with the bank without our consent, although we had been paying the car off for four years and had only one year left to go.

    The bank claims that we still owe them money for the car, our credit is a wreck and we were out thousands of dollars. Even though the insurance company paid them the outstanding balance on the car at the time of theft, the bank claims that we did not have insurance. Even after seven years, now they have got a collection agency after us for money we do not owe them. The nightmare will never end.

  • In 1991, I purchased a truck through a local dealer and financed it through
    Black Cat Bank. I told the dealer to make sure there were no penalties for paying off the loan early. They said it wouldn’t be a problem. What they didn’t tell me about was the type of loan, a Rule of 78s loan — the bank was able to take all the extra payments I had made and apply them so that they didn’t pay down the balance but just extend out the time frame of when my next payment was due.

    I had made several thousand dollars in extra payments and when I called to get a payoff balance, they informed me that my next payment wasn’t due for a year and a half. My payoff balance was way more than I had calculated. The reason was because by making payments with the extra money I was sending them, they were able to take out the interest. So all I had been doing was prepaying them the interest.

    This was not the end of it. I asked the lady, “So, I don’t owe you any more payments for a year and half then, right?” She replied “yes.” Thinking all was OK and [this] the only way I could get back at [them]was to not send them any more payments but pay off the car when the next payment was due.

    Well a year and a half later I called to verify my payoff balance and was I blown-away. The man on the phone informed me that although I didn’t have any payments due for a year and a half, interest was still being charged on the loan balance!