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Big Bank Gets Hit with 9 Million in Fines for Taking Military Cars

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santander

Come on Santander, repossession 101. Never take active military cars? Either the bank hired agents that had no knowledge of the law but they were in fact cheap. Or Santander felt they were above the law and for that they will pay dearly. They could have allowed the debtors to keep each car for less than the nearly 9 and a half million they lost in court.

CLEVELAND, Ohio — Auto lender Santander Consumer USA has agreed to pay $9.4 million to settle charges that it violated military members’ rights when it repossessed their cars, the U.S. Department of Justice announced Wednesday.

The Service Members Civil Relief Act cuts some slack to members of the military who signed consumer contracts before they joined the service or were called up for active duty. Under the act, lenders can’t repossess a military member’s car without a court review, if the service member took out the loan and made a payment before going on active duty.

The Department of Justice said Santander didn’t seek the required court review before it repossessed 760 cars. In addition, the DOJ said, Santander tried to collect repossession fees after it purchased the loans on 352 previously repossessed cars.

Service members whose cars were repossessed by Santander will receive $10,000 plus any lost equity. Santander will pay $5,000 each to those whose cars were wrongly repossessed before it bought their loans.

The Justice Department said the settlement is the largest it has received in an SCRA repossession case.

The Department of Justice said it began investigating after the Army’s Legal Assistance Program referred a repossession case. Justice discovered that Santander also had used an arbitration clause in its contract to keep a service member from filing a class action suit against it.

In the future, Santander will be required to check the Department of Defense’s database to see if a military member is on active duty before it tries to repossess a car.

The Justice Department investigated illegal repossessions between January 2008 and February 2013. The settlement requires Santander to review its files to identify any wrongful repossessions after February 2013.

Service members eligible for restitution will be contacted by the settlement administrator, the Department of Justice said.

Source: http://www.cleveland.com/consumeraffairs/index.ssf/2015/02/santander_to_pay_94_million_fo.html

The service members will get 5k each for the disservice they have gotten.

 

Man tries to unhook car that was already repossessed

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CONYERS — A Conyers man unhappy with having his car repossessed decided to take matters in his own hands and attempted to unhook his car from the tow truck and try to destroy the evidence by breaking the surveillance camera system, according to the Rockdale County Sheriff’s Office.

A Rockdale County Sheriff’s Office deputy was called to a location on Country Trace around 7 p.m. on March 11 where he found a number of people yelling in the street near a tow truck and a red car in the middle of the road.

The tow truck driver told the deputy that he was there to repossess the red car and when he hooked it to the truck, the car’s owner, George Ali Robinson, ran outside and demanded to see paperwork justifying the repossession.

“(The driver) stated that he walked back to the cab of the truck to retrieve the paperwork and Mr. Robinson started to unhook the car from the truck,” Deputy Timothy Kutsch reported.

The tow truck driver told Robinson to leave the truck and car alone and that the camera in the truck recorded him tampering with the car. Robinson then reportedly went to the cab of the truck and tried to take the keys out of the ignition. The two men struggled and the victim showed the deputy red marks and bruises on his arm.

“(The driver) stated that Mr. Robinson then grabbed the camera and ripped it out of the vehicle,” the report states.

He gave the camera to another man, later identified as Cedrick Scanes, and Scanes took the camera into a nearby home.

“I asked Cedrick what did he do with the camera and he stated that he did not know,” Kutsch stated in the incident report. “I advised Cedrick that (the driver) saw him take the camera into the house and that if he knew where the camera was, he needed to return it. Cedrick stated that he did not know were the camera was. I then took Mr. Scanes into custody for taking the camera into the residence.”

Cedrick Maurice Scanes, 22, of 2635 Country Trace, was arrested and charged with theft by taking and being party to a crime.

Robinson, 45, of 2700 Cherry Blossom Circle, was charged with simple battery, criminal damage to property, obstruction of law enforcement officers and entering auto.

 

As Industries Collapse, Repossessions Will Increase

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Photo credit- Digiratilife
Photo credit- Digiratilife

Recently I was at the auction checking some of the last Lincoln Town cars we will ever see. I ended up buying a couple of them and unknowingly 2 of them were repossessions and both of the previous owners worked in the same housing fields. There are certain industries that will without a doubt collapse but not easily. These people are fighting for what they worked for for many years and doing whatever it takes to keep the companies alive. I commend them for that, I have been guilty of staying in companies that were clearly in the downward cycle and had no chance of revival, mostly due to the same corruption that pollutes this country so badly today.

Which industries are likely to collapse

It’s hard to say as so many are falling now. it is tough to find an American industry right now that is not being outsourced to a sweat shop in the East or a company that hedge funds don’t decide one morning to buy the market on. One thing is for certain, most people don’t think much about the future of their company growth or the industries health behind their company so when it does collapse and they are suddenly out of work, 6 months earlier they were thinking whether or not they should finance that car.

We are seeing a huge downward trend in the mortgage industry as inventory will not be increasing anytime soon and if they do they will simply be foreign cash deals. So you might see an extreme influx of mortgage brokers and sales associates cars in the short term. As the society went from simple to shallow, there will likely be no decline in retail brands in the meantime. Which means that even those on minimum wage will spend a large portion of their checks on the big brands that flood the outlet malls.

Many people in the healthcare industry are in deep as well and may not sustain much longer. The new trend is similar to the third world nations such as centra care clinics on every corner for cash and low grade hospitals for the new affordable care insurance. This cannot sustain unless we start bailing out the insurance companies at some point. This newly implemented care will likely close many more industries due to the strain of regulations and will leave lots of repossessions in its its tracks.

Restaurants have been closing left and right, so that industry is pretty much toast unless you have a dollar menu or a food truck. Middle class family restaurants no longer have 1/2-1 hour lines and tables are readily available. This cannot sustain and will likely be a problem, shutting down the companies that are behind these chains will hurt.

Will the repossession numbers be higher this coming year

As they are continually trying to feed us the improving economy crap, increase in job growth without speaking of how many part time jobs they were or how many people came off of unemployment that got taken out of the numbers. The repossession numbers may be slightly higher but nothing huge as the economy has never came out of this recession. A good economy is what creates loans and compulsive buying, toy buying and a bad economy means less repossessions. However, I do feel that as certain industries collapse there may be small surges improving in the repo fields.

Car Repossessions

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Auto RepoCar repossessions are the most common, after all just about anyone with any credit can go to a new or used car dealership and drive away with a car. Amazingly around 6 years ago a statistic with one of our clients called Affiliated Financial was quoting that only a figure of around 6% sub-prime cars go out for repossession at all. I thought that number was extremely low and surely with the worsening economy that number must be growing since. Regardless of the percentage they claimed, the amount of repossessions they contracted out was at least 100 cars per month in Florida alone.

So just imagine between all of the finance companies, banks and in house car dealerships, car repossessions equate to allot of jobs each month nationwide.

I remember when first starting out as a repoman, I was hungry, I was depleting my savings from the multi-million dollar business I had previously that the economy at the time wrecked. It was ok as that glory lasted more then a few years and things change. it was time for me to enter a new realm, to learn a new skill set. I was lucky enough to be sponsored by two companies at the same time. [Read more…] about Car Repossessions

Credit After Repo

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The day has come when times are tougher than usual and the once beautiful credit rating of 700 plus with little debt has suddenly been turned into a 500 credit score and the new Fiat you were driving has now turned into a 1998 Mazda you bought for $500.00. It’s unfortunate and will absolutely have a negative impact for at least the next several years, it will have an impact in almost everything you do. It will affect insurance premiums, it will affect a professional job hiring, during the interview they will have your credit report right there and discuss it one on one. In some cases they will ask you to take care of any negative credit before getting hired, in other cases such as a repo, they will outright deny you for bad credit.

It is almost certain this will actually haunt you for at least 7 years, in fact in many cases as you can read in this other article here on deficiency balances, they will most likely sue you for a deficiency balance if they see that you have obtained a job.

What people typically give up in a credit crisis

You are not alone, there are millions of others with lost or downgraded jobs that were forced to sacrifice one or more of the items they expected would continue to be able to pay. Typically people usually stop paying credit cards first and then decide that the car must also be downgraded in order to keep the house or continue paying the rent.  Even the businesses or businessmen that we have repossessed let the uneccessary things go first, it’s the survival mode. Do you really need that Ferrari or that quick getaway condo in Colorado? These things tend to go first, but the consequences are dire, for example if that business counts on lines of credit and suddenly has a Ferrari repo on their credit, that line of credit will not be extended ultimately causing the business to collapse. Average people losing their jobs or suddenly becoming way over extended usually realize this and purchase a old beat up car for the day the payment car is repo and the credit goes bad. It kind of reminds me of the hierarchy of credit, the natural process that people take on the dime knowing trouble lies ahead.

How long will my credit rating from the repo affect me moving forward

It will take 7 years for it to be off of your credit, that is 7 years from your last payment. There will be collection companies that purchase this debt and continue to confuse as far as when the debt was last paid, so you must keep track in order to ask them to prove it after 7 years. That being said, there are many programs that offer subprime financing for new credit cards or really bad new loans ranging from somewhere around 16% to 28% interest which is tough. If the reason for your repo is justified, such as a job lay off, or a medical emergency let them know and it may help slightly.

Will a repo on my credit stop me from getting a mortgage

With a good solid credit rating moving forward, a good mortgage rate is definitely a possibility in the first 2 years of improved credit perhaps bringing it to the low 620’s which is from what I understand what is needed to get a mortgage. Bottom line is credit after repo is real bad, but with a little bit of work and patience you can quickly build that credit back up.