Ride-Through; Ford Credit and Chase Auto Finance

[sharksfan]

I understand that there is conflicting information on this topic. From what I can gather, it is mainly up to the lender to allow a ride-through to take place.

So... How is Ford Credit and Chase Auto Finance when it comes to not reaffirming loans when the debtor (me) continues to make on time payments?

My attorney told me in regards to my RV, that absent a reaffirmation agreement, my Credit Union could not repo it if I continuted to pay them on time. Can I assume that the same will apply to Ford/Chase?

I'm in the Southern District of New York if that matters (second circuit)...

[Cali]

Our vehicles are through Ford and we were told we could keep them if we continue making payments on time. We were thinking of keeping them both, but now are considering keeping one and letting the other go.

[HHM]

The only car company that took a hard line (when the new law first came out) was Chrysler, I believe they did some repo's early on to drive the point home that you either reaffirm or your car gets repo'd. But I think they even back-downed when the started getting a sense of the costs involved.

Repo's based solely on debtor not reaffirming just don't seem to be happening on any wide-scale. All attorneys still advise that there is a "risk" of repo, but the economics of it from the lender's perspective still favor allowing the ride-through.

[PaKettle]

The only car company that took a hard line (when the new law first came out) was Chrysler, I believe they did some repo's early on to drive the point home that you either reaffirm or your car gets repo'd. But I think they even back-downed when the started getting a sense of the costs involved.

Repo's based solely on debtor not reaffirming just don't seem to be happening on any wide-scale. All attorneys still advise that there is a "risk" of repo, but the economics of it from the lender's perspective still favor allowing the ride-through.

Right. My attorney said that out of hundreds of cases he and his attorney friends have done, no one has reported a repo as long as they keep up their payments.

I have a question, though:
After discharge, I called my car loan holder to see if they got my check and their automatic phone service would not give me any info and they said "You must speak with a representative".

I want to speak with a representative to find out:
1) Is there a grace period after the due date in which I might be late a few days before they'd repo?
2) Can I give them a double payment which they would hold back one in case I make a late payment by mistake?
3) Can I get my web page back which allows me to pay them via the web? (my bank bill payment service does not link to them and I am afraid of missing a payment by some quirk. I find paying my bill through their own web site much easier and more reliable than sending a paper check)

Is there any danger in my speaking with a representative at the bank regarding these issues? Will they threaten me that if I don't file a reaffirmation, they will repo? Will they try to brow-beat me into doing a reaffirmation if I talk to them?

[SUB]

Why give them the opportunity. Sometimes it's better to not draw attention to yourself.

If you want, go ahead and send in that extra payment.

But, can't they go ahead and repo even if the payments are current, or even paid in advance, because of the absent reaffirmation?

[Dirk Squarejaw]

Why give them the opportunity. Sometimes it's better to not draw attention to yourself.

If you want, go ahead and send in that extra payment.

But, can't they go ahead and repo even if the payments are current, or even paid in advance, because of the absent reaffirmation?

From what I understand, they can but in some cases it isn't worth it to reposess if the owner is making timely payments. I mean, if you were the loan company and were getting timely payments, would you continue to do that or pay someone to go recover the car, pay for an auction, and take far less than the loan amount when the car sells at auction?

[Cali]

Now I am more confused about the car situation. So a company can actually take the vehicles even if you've never missed a payment?

[HHM]

I want to speak with a representative to find out:
1) Is there a grace period after the due date in which I might be late a few days before they'd repo?
2) Can I give them a double payment which they would hold back one in case I make a late payment by mistake?
3) Can I get my web page back which allows me to pay them via the web? (my bank bill payment service does not link to them and I am afraid of missing a payment by some quirk. I find paying my bill through their own web site much easier and more reliable than sending a paper check)

1. Although most lenders will still recognize the original grace period, DO NOT COUNT ON IT. Make sure you get the payment in on time.
2. No, overpayment on a car loan does NOT absolve you of making next month's payment. All an overpayment does is reduce your principal. Lenders are not set up to hold payments like that. You can over pay on a lease and it DOES get counted toward the next month payment, but not on a conventional loan.
3. Probably not, the debt is technically discharged to you, so the only remedy the car company has is to enforce the lien. Because the debt is dicharged, the lender is under the permanent injunction to take no actions to collect the debt. So usually, online access or any other automated access to your account will be shut off for the remainder of the loan, and you will usually not receive statements or bills.

This whole situation is just another aspect of the new BK law that was not well thought out. (1) Repo is controlled by state law; usually, under most repo laws, lenders need an actual default in payment in order to exercise the repo remedy. (2) I have certainly NOT heard of a car being repo'd AFTER DISCHARGE for failure to reaffirm (maybe someone can research that fact). I think there is a STRONG argument that because the "reaffirm or surrender" choice is only in BK law, that the lender CAN only exercise the remedy during the BK (and shortly thereafter, since the debtor can disavow a reaffirmation agreement within 60 days of signing it).

In the 2.5 years since the new BK law, some lender, somewhere must have tried, so its just a matter of finding that case. But, I think if you are 2 months after discharge, and have on time payment, I don't think a lender can repo a non-reaffirmed auto, or, more accurately, you could probably file a defense to the repo and have a better than average chance of winning.

Bottom line, it is "possible" that your car could be repo'd for not reaffirming, but it is very unlikely.

[sharksfan]

This whole situation is just another aspect of the new BK law that was not well thought out. (1) Repo is controlled by state law; usually, under most repo laws, lenders need an actual default in payment in order to exercise the repo remedy. (2) I have certainly NOT heard of a car being repo'd AFTER DISCHARGE for failure to reaffirm (maybe someone can research that fact). I think there is a STRONG argument that because the "reaffirm or surrender" choice is only in BK law, that the lender CAN only exercise the remedy during the BK (and shortly thereafter, since the debtor can disavow a reaffirmation agreement within 60 days of signing it).

Both Chase and Ford have 'BK = default' clauses. Do these hold any water say, 6 months post discharge even if you are current on payments? I think I need to research NY repo laws...

[HHM]

Both Chase and Ford have 'BK = default' clauses. Do these hold any water say, 6 months post discharge even if you are current on payments? I think I need to research NY repo laws...

Most of the time, those BK default clauses are tossed out. But they still appear in many contracts.

[PaKettle]

1. Although most lenders will still recognize the original grace period, DO NOT COUNT ON IT. Make sure you get the payment in on time.
2. No, overpayment on a car loan does NOT absolve you of making next month's payment. All an overpayment does is reduce your principal. Lenders are not set up to hold payments like that. You can over pay on a lease and it DOES get counted toward the next month payment, but not on a conventional loan.
3. Probably not, the debt is technically discharged to you, so the only remedy the car company has is to enforce the lien. Because the debt is dicharged, the lender is under the permanent injunction to take no actions to collect the debt. So usually, online access or any other automated access to your account will be shut off for the remainder of the loan, and you will usually not receive statements or bills.

...[edit]
Bottom line, it is "possible" that your car could be repo'd for not reaffirming, but it is very unlikely.

Thanks much for clarifying those points.

My only problem is that I want to be able to pay them electronically and it sounds like there is no way other than changing my bank so that bank's Bill Pay might work with this lender. (My current bank''s Bill Pay does not work with them.) I just wish there was some way I could insure my payment does not get to them late. Even if I make a point to send it in a couple weeks early there is still the chance it could get lost in the mail or on someone's desk there, and I could forget to double-check that it went through. I really hate paper checks now that I'm used to electronic banking! And even things like my rent, I have simply forgotten to pay, before, simply due to a lot of hectic stuff going on in my life and I didn't think to pay it...

So I am inclined to call my car finance co. and ask them if they would please let me pay via their web site... or otherwise give me a manner to hook up my bank's Bill Pay to them...

Thinking outside the box... Is there a way I could transfer the title to my wife and then let HER sign up for their web site? She filed bankruptcy too but the car was not / is not in her name...

Or ...?

p.s. It is beginning to look like members need a "sticky" on this subject...

[$$only4ever]

I made an extra payment before I filed so I am always one month ahead. My understanding is once you file bankruptcy unless you reaffirm, all bets are off. Technically, they can repo if the payment is only 1 day past due, but due to the cost and the upfront loss to auto finance companies, they usually don't select that option.

[HHM]

Thinking outside the box... Is there a way I could transfer the title to my wife and then let HER sign up for their web site? She filed bankruptcy too but the car was not / is not in her name...

When it comes to paying the loan, title does not matter, it is who is on the loan.

I am surprised your bank does not let you use online bill pay. Maybe you should switch banks, I can pay ANYONE through my bank's online bill pay. If they can't transmit the payment electronically, they just cut a check and mail it.

There is no harm in calling and asking, but I would not hold your breath.

[erinmi]

My only problem is that I want to be able to pay them electronically and it sounds like there is no way other than changing my bank so that bank's Bill Pay might work with this lender. (My current bank''s Bill Pay does not work with them.) I just wish there was some way I could insure my payment does not get to them late.

Who is your car financed through?

Both of our cars have automated phone systems, which allow us to pay by electronic check over the phone. Ford Motor charges a fee of $5 to do it, Chase Auto does not. Since I too want to be sure the payment for the car we are doing a ride through on gets there on time, I just call Chase and process the payment that way and receive a confirmation number that the payment was received and when. It usually shows up on my bank account within a couple days.

Pull out your last statement and see if there is a phone number listed specifically for that purpose.

I too am surprised your bank's bill pay does not work with your finance company, mine also cuts a check if it cannot send an electronic payment.

[PaKettle]

Who is your car financed through?

Both of our cars have automated phone systems, which allow us to pay by electronic check over the phone. Ford Motor charges a fee of $5 to do it, Chase Auto does not. Since I too want to be sure the payment for the car we are doing a ride through on gets there on time, I just call Chase and process the payment that way and receive a confirmation number that the payment was received and when. It usually shows up on my bank account within a couple days.

Pull out your last statement and see if there is a phone number listed specifically for that purpose.

I too am surprised your bank's bill pay does not work with your finance company, mine also cuts a check if it cannot send an electronic payment.

This is Honda and I don't think they have a free phone payment service. Anyway, when I call Customer Service, after I enter in my account number, all I get is a recording telling me to ask to speak to a representative.

I should say that my bill pay service at my bank DID allow me to make a payment via check (not electronically because it is not listed as a pre-set-up payee). However, I tried a $1 test payment and it took like TWO WEEKS to go through (I made it the same day I mailed a full payment and my check payment went through in less than one week) AND it doesn't even look like it was to the right lender! I'm still investigating who it was that actually received my $1 test payment but it sure is not listed as Honda Financial!

I think I will call Honda on Monday and speak to a representative and see if I can work something out with them to get my online bill pay back or at least make one payment ahead, or something to give me some assurance I won't accidentally miss a payment or the payment doesn't end up misdirected or lost or something.