Bank Won't Repo Car

[Zigner]

Continuing from Elma:

"This Court has ruled that where the secured party’s disposition or sale of the collateral was commercially unreasonable, any resultant damages inuring to the debtor may be set off
against the amounts owed by the debtor to the secured party under the terms of the security agreement. Citing: Jones v Morgan, 58 Mich App 455, 460; 228 NW2d 419 (1975); see also Citizens National Bank of Cheyboygan v Mayes, 133 Mich App 808, 811; 350 NW2d 809 (1984).

Lat - the secured party is not disposing of or selling the collateral in this case. Additionally, the debtor can't just simply write a letter and wash their hands of it. It doesn't work that way and we both know it. I believe you are misinterpreting something, somewhere.

 

[justalayman]

Lat - the secured party is not disposing of or selling the collateral in this case. Additionally, the debtor can't just simply write a letter and wash their hands of it. It doesn't work that way and we both know it. I believe you are misinterpreting something, somewhere.

That’s Latigos point. Since the secured party is failing to take steps to reclaim the security, they cannot claim additionally losses beyond what they would be if they acted on a reasonable manner.

In other words; they are failing to mitigate their damages. Most courts do agree that such action limits the amount one can claim as damages.

 

[latigo]

Lat - the secured party is not disposing of or selling the collateral in this case. Additionally, the debtor can't just simply write a letter and wash their hands of it. It doesn't work that way and we both know it. I believe you are misinterpreting something, somewhere.

I'm aware that the bank has taken no action towards exercising its rights to the collateral. But that delay is the hub here. And I don't think that these people understand that the bank must first dispose of the collateral, nor the methods of disposition required in that process before pursuing a deficiency judgment and their rights if the creditor fail in those processes?

But since you've raised the issue, why don't you tell us "how it works". Explain for us if you will the conditions precedent and processes and implications of the secured creditor obtaining a deficiency judgment.

Including how the attorney for the bank in suing for a deficiency judgment would counter the debtor's argument that she is entitled to off set against that claim the difference in what the bank received in disposing of the vehicle 18 plus months after the account went into delinquency and what it could have obtained had it acted timely in effecting the disposition of the collateral.

Perhaps the point has no merit, but I would put the bank on notice that I intend to pursue it.

 

[justalayman]

If I may;

The basic contract is quite simple. Debtor promises to pay creditor $XXXXX.xx. Failure to pay that is a breach and alllows Creditor to seek a judgment of balance owed.

Now, while the car is given as collateral (hence the security interest) what mandates the creditor actually repossess the collateral and liquidate it rather than simply seeking a momey judgment for the money owed? I would suspect if they sought a judgment for the entire amount owed they would be obligated to release their lien since they have recieved a judgment for the total amount owed and no longer are due any value represented by the car.

 

[cousinmose]

I appreciate all of the great feedback. Unless I missed it, I didn't see a clean way to force the bank to retrieve the vehicle. Is she stuck with the car until either, the bank decides to come get it, or, she files bankruptcy (which is being considered due to medical debt)? Is there a 3rd option?

 

[Zigner]

I appreciate all of the great feedback. Unless I missed it, I didn't see a clean way to force the bank to retrieve the vehicle. Is she stuck with the car until either, the bank decides to come get it, or, she files bankruptcy (which is being considered due to medical debt)? Is there a 3rd option?

She could try to sell the car (borrowing the amount due to cover the deficiency).

 

[FlyingRon]

Even a bankruptcy won't force a disposal of the car. It just removes her responsiblity for the loan.

 

[justalayman]

If you look around the archives you can find stories of similar nature where a car was left for years by the bank. Some people wanted to move but needed to figure out what to do with the unusable rusted hunk of metal setting in their driveway.

Yes, the bank can simply let it set if that is their choice.

 

[TimStudiesLaw]

I appreciate all of the great feedback. Unless I missed it, I didn't see a clean way to force the bank to retrieve the vehicle. Is she stuck with the car until either, the bank decides to come get it, or, she files bankruptcy (which is being considered due to medical debt)? Is there a 3rd option?

Voluntary repo. Drive/push/tow it to the bank. Leave the keys with a branch manager.

 

[LdiJ]

Voluntary repo. Drive/push/tow it to the bank. Leave the keys with a branch manager.

Assuming that there is a bricks and mortar branch of the bank.

 

[Zigner]

Assuming that there is a bricks and mortar branch of the bank.

There are a fair number of Wells Fargo Bank locations to be found

 

[Zigner]

Voluntary repo. Drive/push/tow it to the bank. Leave the keys with a branch manager.

That will do nothing to relieve the debt. Really. In fact, it could end up causing even MORE financial harm to the OP's daughter when the bank calls the tow company to tow away the abandoned vehicle...

 

[cousinmose]

There are a fair number of Wells Fargo Bank locations to be found

The closest WF bank branch office is 3 hours away. However, there is a WF Financial Planning office very close. Drive it there and hand over keys to manager? Could they send it back? Could it be towed away and daughter fined?

 

[justalayman]

The closest WF bank branch office is 3 hours away. However, there is a WF Financial Planning office very close. Drive it there and hand over keys to manager? Could they send it back? Could it be towed away and daughter fined?

It is not their car. It is yours. It is illegal to abandon a car on property that does not belong to you in the state of Michigan. Yes it is possible she be fined for abandoning the car. They will not accept the car at whatever office you go to. Dropping the keys off is not them accepting it. It is you abandoning it no different than if you went to Walmart and parked it in their lot and walked in and handed somebody the keys.

The proprietors of wherever you abandon the car can simply have the car tagged as abandoned and cause it to be towed. The registered owner and the lien holder will be sent a notice the car is being held by the tow yard. If nobody claims it the tow yard can dispose of it as the law allows. All that means is Wells Fargo wil still be owed everything they are now plus the continued interest on the loan until paid.

 

[TimStudiesLaw]

That will do nothing to relieve the debt. Really. In fact, it could end up causing even MORE financial harm to the OP's daughter when the bank calls the tow company to tow away the abandoned vehicle...

They were simply looking to get the collateral back to the lienholder. They are already to the point of considering bankruptcy, there's not much more damage that can be done.

When I financed cars, we would purposely refuse to repo cars that were in bad condition, didn't run, wrecked, etc. and leave them in possession of the buyer. We'd take the charge-off and be done with them. If they wanted the title, we'd dig in just like WF is doing here - pay they balance or go away. If, however, the vehicle showed up at our business, we treated them as a repo, sent the necessary letters, and disposed of them at auction or to a wholesaler.