Beware of cross collateralization

[tkharvey]

That's my fear, too. They said to trust them, but I never in my wildest dreams would have thought that they would have taken my daughters car in the middle of the night. It's a 99 Honda accord, super clean, as we just be soooo much money into it. 95K miles. Owe 5,600 for it. Big John, how hard would it be to buy back the car at auction? Do you know if I can contact auction place and buy it back before auction? I've never dealt with anything like this before.

[ShouldWeFile]

Only the credit union can decide when and where to sell it. Many credit unions list the repossessed vehicles on their web site. They have no intention of doing that at this time. Only if you elect not to redeem the vehicle will they look at liquidating the vechile. At this time they believe you will pay them the $5600.

If I were in your shoes, I would not pay them without a statement in writing along the lines of "the payment constitutes full and final payment on the 99 Accord and you will receive a free and clear title." Though I do believe they are looking to give you the vehicle and title in exchange for the $5600, without written documentation, the verbal promises are useless. They are playing the game by their own rules anyways... repossessing an automobile in the middle of the night that you were current on.

On another note, a 99 Accord with 95000 miles that you just put work in MIGHT be worth close to $5600 at full retail value. You can also buy a lot of other vehicles for that $5600 figure. As a matter of fact since you have cash, you can buy close to wholesale from a private buyer on craigslist, cars.com or autotrader.com...

[chad9162]

If I were in your shoes, I would not pay them without a statement in writing along the lines of "the payment constitutes full and final payment on the 99 Accord and you will receive a free and clear title."

Trust a financial institution that you are BKing is stupid. You might as well give them the money and have them credit it towards your CC's. If they were being HONEST why would it matter to give you something in writing. Funny when yo borrow money it has to be in writing. How many lenders rely on just "TRUST" when lending you money, hmmmm NONE!

[rrockinggramma]

I haven't been here in a while since I was discharged and closed. However I would recommend that you take that 5 K and go purchase a cash car for your daughter and include the CU car in you BK. Also sign up with another credit union and take your business elsewhere. This is a common play for CU's when a BK is filed. Because of that cross collaterialization clause, your car won't be paid for until the Visa is paid off.

Walk away from this place and pay cash for the car. Be sure to include the borrowed money in your BK filing however so that person can be paid back through the trustee.

[tkharvey]

OK, I DID get my daughter's car back....paid it off and they released it from repo lot and said the title will be mailed to us in ten days. We are parking her car in the garage until we get that title in our hands (just in case). My attorney said that if we don't get the title before we file bk, then it's going to probably be after our plan (five years). At that time the car will be over fifteen years old so I really could care less at that point. What a nightmare this week has been. Same credit union tried to repo my van today (same deal....a bit late on van payments but again, have a defaulted visa that the CU "cross collateralized" on. They were waiting down the street when I took my eight year old to school. The tow truck followed me right into the school parking lot, into the car rider line, then back home. I quickly pulled in garage and shut the door and they pulled away, but my neighbors were outside. How humiliating. Hubby and I decided it wasn't worth it (this "running from the law" thing is not my style LOL) and surrendered the van today. Didn't bother me much since my father, who is unable to drive, has a perfectly good van in his driveway that I can drive. Actually, I feel relieved. The stress associated with financial difficulties is overwhelming.....by surrendering the van it has freed up over $500 a month, much less the peace of mind of not having to look over my shoulder everytime I leave the house with my kids. For those of you who have more than one account with a credit union, MOVE OR CLOSE YOUR ACCOUNTS NOW!

[walkthaplank]

I have a car loan with one credit union, and a visa with another that I am including in my 13. They apparently have gone into some partnership in the last year, I'm just wondering if they are going to try to mess with me? At this point they are two distinct credit unions, I just don't know what "partnership" means in the Credit Union world.

[tkharvey]

Gosh, I"m not sure since they are two separate credit unions. Just be careful and look into it. I never knew what happened to us could happen if we were current on our car loans, but it did.

[walkthaplank]

I've been paying the minimum's on my CU visa and will up until we file... I'm not taking chances with them... When I file, it'll be too late for them to do anything. My car will be paid outside of the plan and will be paid off before the end of the plan meaning they probably won't be able to play title games with me.