I was in a car accident in January of 2005, I owed about 13k left on my loan with HSBC. The car was totaled and my car insurance was to pay the balance of my loan. I just pulled my credit report and show a write off with HSBC, meaning they never got paid for the car from my car insurance and wrote it off. In two years, I just received a collection notice from a collecting agency stating they want the money for the balance. HSBC collections isn't returning my phone calls, my car insurance company is taking there time to give me an explanation on why they haven't paid anything to HSBC. So i have questions that i need answered... Since HSBC wrote it off, who is the lien holder? The collection agency? Or is there no lien holder of my note? If my insurance company decides to write a check to clean this mess up, can they write the check to me?, so i can deal with the collecting agency or will they write the check directly to the collection agency? Lastly, who can take this off my credit report? Any suggestions on what i can expect would help. Thanks!
A couple of quick questions here: 1) Do you know what the "payoff amount" of your loan was at the time of the accident (not # of remaining payments X payment $, but what the amount was to "close or payoff the loan)? 2) Did you alert HSBC (auto loan lien holder) that you had been in an accident, and that your insurance company would be paying off the loan balance? 3) Was the car "worth more" than you owed for the payoff amount? Sound like something is very wrong here, after three years to not have this paid/settled is a serious issue. First, your insurance company should have paid this balance off, as long as there were no extraordinary circumstances. HSBC would be the "lien holder", if the auto loan was with them. It's impossible to tell if HSBC is using an internal collection agency or has sold the debt to another CA. It sounds like this is an "internal collections". Just start calling everyone, and demanding to know what happened. Find out from the HSBC collections the amount they say you owe, and how long you've owed this debt. Inquire with your insurance company why this loan was not paid. Stress that you will write & call your state's insurance bureau regarding this issue, if not resolved promptly. Almost three years is plenty of time for the insurance company to settle this. The collection agency will have to be the one to remove the item from your credit report, as will HSBC (lien holder division) as I'm sure there is an entry for negative information regarding your auto loan. The bottom line is that this will be a lot of work, and you'll have to be a "PITA" (Pain In The A..) to get results. Insurance companies do try to dodge paying, and often must be forced. I learned this from a friend in the business, when I had a third party insurance company not paying a bill. The threat of a lawyer's involvement usually motivates them as well!
The first thing I'd do is try to find out from HSBC if you insurance company DID pay. If you were "upside down" in the car (meaning you owed more than the car was worth) the insurance company would only pay the value of the car. They don't necessarily pay off the loan, only to the value of the car. You would then be responsible for paying the difference, called the deficiency. In all the ensuing years, this balance would likely be building up interest, and it's possible that the payoff now is almost what the balance was when you had the accident. So I'd start with a letter to HSBC, asking them to send you an accounting of how they arrived at the balance, since you don't believe it is correct. You may find that your insurance company did, in fact, pay. Make sure you're checking with the correct office at the insurance company as well. You need to speak to whoever the claims adjuster for the claim was. If that person has left, ask for someone who took over his or her accounts.
Interesting. I always understood that when a car was a total loss the insurance company would take ownership of the car, since they basically bought it. I would be curious as to how they got title to the car to sell it for salvage, without ever paying HSBC.
"short answer", there are many times when the vehicle exchanges with the salvage company without the title, although the "removal" of the vehicle is required to be documented (that the VIN is no longer in use).
