Dear Consumer Ed:
A financing company is harassing me about an old loan on a car I voluntarily surrendered. I've been paying them $75 a month to stay off my back, but they are relentless. How do I make them leave me alone?
Consumer Ed says:
First, it is important to understand the repercussions of voluntarily surrendering your car to the dealer or financial institution that carries your loan. The owner of your loan will sell your car at auction for what is often much less than what it would bring at a retail sale. You may be faced with large fees as well. After your car is surrendered and sold, you become responsible for the difference between the amount you owed on your loan at the time the car was surrendered, plus fees, minus the amount for which the car sold at auction. What happens is that you are now paying for a car that you can no longer drive and will never own.
Because you have had a prior business relationship with this financing company, calls are still permitted by the company even if you have your telephone number added to the "do not call" database. If it is a debt collector who is calling on behalf of your financing company, the Fair Debt Collection Practices Act ("FDCPA") may apply. The FDCPA does not apply to a creditor collecting its own past-due accounts; so, if the company calling you is the company that lent the money to you, the FDCPA does not apply. However, if the company is using a third-party debt collector to contact you, you have the right to request that they not contact you again. This request must be in writing. Make sure to include a statement that your letter is not meant in any way to acknowledge that you owe this or any other sum of money. Mail your letter certified, requesting a return receipt so that you have proof of its delivery. Once the agency receives your letter, its employees can only contact you one more time to explain what action they plan to take. After that, they must not contact you.
You can also request that a collection agency not call you at your place of work. Send the same type of letter discussed above and instruct the debt collector to refrain from contacting you at work. By law, the debt collector must comply. Remember, though, stopping the contact does not stop the debt-collection activities. The debt collector can still send negative information to the credit-reporting agencies, sue you in court, and garnish your wages or file a lien against your property once a judgment is issued by the court.
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