Bankrate follows a strict editorial policy, so you can trust that we’re putting your interests first. Our award-winning editors and reporters create honest and accurate content to help you make the right financial decisions.
Key Principles
We value your trust. Our mission is to provide readers with accurate and unbiased information, and we have editorial standards in place to ensure that happens. Our editors and reporters thoroughly fact-check editorial content to ensure the information you’re reading is accurate. We maintain a firewall between our advertisers and our editorial team. Our editorial team does not receive direct compensation from our advertisers.
Editorial Independence
Bankrate’s editorial team writes on behalf of YOU – the reader. Our goal is to give you the best advice to help you make smart personal finance decisions. We follow strict guidelines to ensure that our editorial content is not influenced by advertisers. Our editorial team receives no direct compensation from advertisers, and our content is thoroughly fact-checked to ensure accuracy. So, whether you’re reading an article or a review, you can trust that you’re getting credible and dependable information.
You have money questions. Bankrate has answers. Our experts have been helping you master your money for over four decades. We continually strive to provide consumers with the expert advice and tools needed to succeed throughout life’s financial journey.
Bankrate follows a strict editorial policy, so you can trust that our content is honest and accurate. Our award-winning editors and reporters create honest and accurate content to help you make the right financial decisions. The content created by our editorial staff is objective, factual, and not influenced by our advertisers.
We’re transparent about how we are able to bring quality content, competitive rates, and useful tools to you by explaining how we make money.
Bankrate.com is an independent, advertising-supported publisher and comparison service. We are compensated in exchange for placement of sponsored products and, services, or by you clicking on certain links posted on our site. Therefore, this compensation may impact how, where and in what order products appear within listing categories. Other factors, such as our own proprietary website rules and whether a product is offered in your area or at your self-selected credit score range can also impact how and where products appear on this site. While we strive to provide a wide range offers, Bankrate does not include information about every financial or credit product or service.
I traded in my 2007 Chevy Colorado for a new 2009 Mazda 6 on Nov. 15. I just got a bill from my lender on the Colorado and contacted them. They say they have not received payment from the dealership and have no record that I traded in the car, so I am still liable for the payment.
I have been calling the dealer daily but cannot reach the finance manager, who I was told I needed to talk to.
What do I do?
As the economy and vehicle sales continue to slide, more and more dealerships will encounter problems fulfilling their financial obligations. Until a dealership sells a trade-in, whatever equity value they placed on it for the purposes of working out the financing on the new vehicle purchased is a paper asset. The dealership must dip into its cash reserves to pay off the outstanding loan on the trade-in. The temptation for a financially challenged dealership is to stall paying off that trade-in until it has disposed of it. And if money is really tight, the temptation becomes selling your trade-in and using the cash for something else, like the electric bill or renting those big, inflatable figures you see in front of their showrooms.
But dealerships don’t just have a moral obligation to pay off trade-ins; they have a legal obligation to do so. The laws on such matters vary from state to state, but most states have a specified time period — frequently 15 to 30 days — in which to pay off a trade in. If the dealership doesn’t make the payoff during the allotted time, it is breaking the law — in most states it’s a felony.
Forget this phantom finance manager – he’s just a glorified salesperson anyway. If you wish to continue attempting to resolve this at the dealership level, send a certified letter with a return receipt requested to the dealership owner and/or general manager. Make your complaint and give the dealer seven or 10 days from the receipt of the letter to pay off your trade-in and if that is not done you should contact your state’s DMV.
If you need to follow up with the DMV, which you can do online, be sure to have all of your paperwork including a copy of the letter to the dealership and return receipt. With the amount of time that has elapsed in this case, however, you can probably forego trying to make any further contact with the dealership and take your complaint directly to your state’s DMV.
The bad news, however, is that you are responsible for making the payments on your old Colorado until this is resolved. The former lender should refund to you any overage once it is paid off, but it’s your responsibility until then.
Here are this week’s reader questions:
Share