Wachovia Harrasses Me For Phantom Car Loan Payment

Richard bought a vehicle, returned it and bought another from the same dealership. He says Wachovia erroneously paid off the second loan instead of the first. Once he got the finance department to correct the mistake — a process that took a month — Wachovia started hassling him to make a payment for which he was never billed.

He sent us the letter he wrote to Wachovia:

My name is Richard [redacted], I have a loan with your dealer services department on a car loan. My problem lies with the constant harassing phone calls from your recovery department and its personnel. My loan was opened in June of this year for a Dodge Ram truck (financed through your company) at [redacted]. Within a week of purchasing the vehicle my wife and I returned it to the dealer, unhappy with it and purchased another vehicle, (also financed with your company) a Chevrolet Trailblazer.

Through the return and purchase your finance company, after I paid my first payment on time paid off the wrong vehicle and was still sending us payments for the Dodge instead of the Chevrolet (which they had already paid off). This mistake was resolved by our effort, but the time frame took over a month to make clear. After learning of your mistake, with our help your finance company reopened a new loan for the Trailblazer. During the month in which your company fixing their mistake we did not send a payment, due to the fact we had no account, or amount for the new vehicle to send not to mention where it would end up. In the end, the problem was solved but they dated the new loan for the opening in June.

This put a month behind, which we thought they would just add to the back of the loan and proceed forward. This was not the case and in the economy the way it is I was laid off and my wife is supporting our household. We have tried in everyway to make this work and have talked to numerous people of the problem, but seem to get no where. We have even added $70 dollars and $30 to our last two payments in an effort to show were making an effort. This seems to not be enough for your company and receive 3-4 calls a day, harrassing us for the payment. My wife and I have never had a problem with making past car payments and dont seem to understand why we can’t seem to come to mutual aggreement on how to fix the problem.

This mistake is becoming a major burden on our family in these tough times and were hoping for some resolution. All we’re asking for is to just add the difference to the back of the loan or stop harassing us, when our effort is more than yours. I appreciate your time and if you can’t help me I hope you can pass it on to somebody who will.

I wonder if Richard could refinance through another bank, which could reset the loan amount and make the phantom payment vanish. He shouldn’t be forced to go through the hassle, though. What would you do in his situation?


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  1. pecan 3.14159265 says:

    What I’m getting here is that Wachova mistakenly closed the loan on the second vehicle instead of the first – and when they fixed the error, the OP had already missed one month of payments, and assumed (erroneously) that it would simply be added to the end of the loan. This didn’t happen, obviously, and now the OP is getting harassed by Wachovia because he owes the extra payment – so why doesn’t the OP just pay the month he missed and catch up to his monthly owed amount? Or am I missing something?

    • TinaBringMeTheAx says:

      They had the money in June, then didn’t have the money in July, or whenever the paperwork was cleared up.

      It appears they hit a financial rough spot right after buying a new car.

      Not, imho, Wachovia’s problem.

      But seriously, they could have tacked it on the back end, right?

      • pecan 3.14159265 says:

        I don’t think so. It would seem simple, but I don’t think that’s the way the loan works. Five year loans can’t magically become five year and one month loans, right? Cause then, if I just miss a few payments, they’ll get tacked onto the end and I’ll just work on it later. Again, I may be totally wrong about how loans work.

        • TinaBringMeTheAx says:

          No, not five years and one month: Five years with a new start date one month later, when the paperwork was corrected.

        • nucwin83 says:

          Actually they can. Chrysler Financial did that very thing for me once when I couldn’t make a payment. My final payment was scheduled for 7/2010 instead of 6/2010. So it definitely can be done, but I think the OP made a mistake by assuming that they wouldn’t have to make a payment for June (and I definitely have questions about the OP not knowing their monthly payment amount… both car loans I’ve had explicitly indicate in the paperwork the amount of the payment per month).

        • henrygates3 says:

          Yes, you can defer a payment for a month. Under the circumstances I think that would be reasonable for the bank to do. No special magic involved, any low level CSR can do that kind of thing.

      • Garybaldy says:

        It does not sound like they hit a rough spot at all. It looks like they received a bill for the wrong vehicle and decided not to pay it until the paperwork was correct.

        What it appears they did wrong was spend said money instead of holding it in case the bank wanted it after they fixed the paperwork screw up.

        Come on the people who read this blog would never pay a bill for a wrongly billed vehicle. You just know that money would evaporate.

    • subsider34 says:

      To quote from above: “During the month in which your company fixing their mistake we did not send a payment, due to the fact we had no account, or amount for the new vehicle to send not to mention where it would end up.”

  2. NeverLetMeDown says:

    Yup, looks to me like the issue here is that he doesn’t have the money to make his truck payment.

    OP didn’t make _any_ payment while the confusion with the two loans was resolved, and, now that the issue has been cleared up, he’s a payment behind, and hasn’t caught up b/c of his financial circumstances.

    Now, it might be nice of Wachovia to just extend the loan for a month, but I don’t think they _have_ to do that.

    • MikeB says:

      They didn’t make a payment because they didn’t have a loan. The bank closed the wrong loan when the OP returned his truck. Which account should he have sent in the payment too?

      • NeverLetMeDown says:

        Not saying they should have paid the loan then (they clearly couldn’t), but they also shouldn’t assume that it would be “hey, free month!”

        • tbax929 says:

          Agreed. He should have put the money aside, as he certainly knew the new car wouldn’t be free. Instead, he spent it. No sympathy from me on this one.

        • coren says:

          They aren’t assuming that either, they were assuming that the paperwork wouldn’t be backdated, and that it would instead be a five year loan (or whatever length) starting from when the paperwork was corrected. Which is an entirely reasonable assumption to make.

          • godlyfrog says:

            It’s only reasonable if they weren’t in possession of the car at the time, which they were. They had taken a loan and purchased a car with it, and just because they had no account to pay it on is not the same as being free to spend the money as they see fit. Any reasonable person should expect to make a double payment after the paperwork is fixed, and in return, not get any late payment fees or a ding to their credit report due to the bank’s screw-up.

  3. Admiral_John says:

    I’m having a hard time siding with OP on this one. When he traded vehicles and closed the new loan the paperwork he received should have indicated what the monthly payment would be; that money should have been saved to be paid when they received their first bill. And did they ever receive any sort of confirmation that the missed payment would be tacked onto the end of the loan, or did they just assume that’s how it’d work?

    Sorry, but I think OP is at fault here.

    • acknight says:

      How does one make a payment on a loan that doesn’t exist, though?

      • pecan 3.14159265 says:

        The loan didn’t exist in a sense that paperwork was filed, but it did exist in that it should have been filed and he had the car without paying for it. So when the paperwork was filed, it required two payments – the current monthly payment, and the month prior to that. I think the problem was that he didn’t have money for what was supposed to be the first month’s payment.

        Since they have financial troubles, I’m wondering whether he can return the trailblazer, end the loan, and buy something less expensive?

        • Corporate_guy says:

          Why did the loan company have to back date the loan?

          Why couldn’t they just date it from the current date the loan was fixed on?

          You cannot fault the OP here, because the bank screwed up. The OP is making the normal monthly payments just fine. The bank should clearly just push the loan back a month and let the customer make the normal payment amount.

          Should the OP have gotten a loan they can barely afford? Of course not. But the OP can clearly make the normal payment, just cannot afford a double payment. The solution for the bank is clear, push the loan back a month and let the customer pay it off. The bank will get all of it’s money that way with the interest.

          It appears though that the bank would rather ignore their screwup, ruin the credit of someone making their monthly payments on time, repossess the vehicle, and lose money on the vehicle at auction.

          This of course is what is wrong with the banking industry. Here is a situation where what is best for the customer is also best for the bank, but due to the shoddy way this bank is ran both sides are going to get screwed for no reason.

  4. There's room to move as a fry cook says:

    That was confusing (esp. ” paid off the second loan”) but at the end of the day the OP has driven a new (used) vehicle for 6 months and paid for 5. I assume it is used as he bought a Dodge & Chevy from the same dealer.

  5. Loias supports harsher punishments against corporations says:

    I’m surprised he’s okay putting the extra interest back in to the loan from when he could not make payments on a non-existing loan. Wachovia should waive all interest and fees for the month it took them to figure out what they did wrong; start the loan at the time they corrected their mistakes and start payments then. Wachovia should be giving Richard every benefit of the doubt for their own mistake.

    Okay, who wants the soap box next?

    • There's room to move as a fry cook says:

      It is likely the dealers fault for screwing up the paperwork – not Wachovia.

    • mac-phisto says:

      thank you for clearing the air. it was getting a little stuffy in here.

      i’m with the OP on this one. while he should have been saving up the money for the payment he didn’t make, i think it was smart NOT to send a payment before the inconsistencies were rectified, especially with an institution that takes a month to fix an error like this.

      unfortunately, i don’t think refinancing the loan will be very easy if the OP is still unemployed. i think i would just keep harassing wachovia until they make the changes necessary.

  6. Garybaldy says:

    So the 2nd loan was closed when the first should have been. Leaving the couple with no bill for the correct vehicle. Possibly a bill for the 1st vehicle? I wonder how many here would have sent the due amount in for the wrongly billed first vehicle.

    Personally i would have held onto the money for that wrong bill. So when the bank straightened its paperwork out. If they wanted a payment for that month i would have it. Sounds like they spent it.

  7. Firethorn says:

    Well, Executive carpet-bomb is an option, and the company should certainly waive any interest/penalties, but you should have known that a payment would be due, and had the money available.

    I view it kinda like a payroll mistake as happens with my work – put it in a savings account, mark it ‘unavailable’, because they’ll pull it out when they figure out their mistake.

    I’m sorry for your job loss, but would ask: Is the vehicle really nesessary?

    Especially with a dual-income family, you should generally keep several months worth of income in semi-liquid assets*, and you should also be getting some form of unemployment. I advocate keeping your non-optional expenses down to around 70% of your income, max.

    *IE you can convert it to cash in less than a month without substantial penalty

    • There's room to move as a fry cook says:

      “Especially with a dual-income family, you should generally keep several months worth of income in semi-liquid assets*, and you should also be getting some form of unemployment. I advocate keeping your non-optional expenses down to around 70% of your income, max.”

      That’s nice in theory but not in practice when many are just trying to keep afloat. Note that the OP needed a vehicle and did the prudent thing by purchasing used not new. I believe its the dealer who messed up and sent in the wrong or incomplete paperwork to Wachiovia. I had to work through an error after my dealer sent the wrong info to the credit union.

      • Firethorn says:

        That’s nice in theory but not in practice when many are just trying to keep afloat.

        Part of ‘keeping afloat’, in my practice, is to keep a reserve available. If your reserve doesn’t stretch even a single vehicle payment, you don’t have enough.

        I picked 70% for a reason – that’s normally what unemployment pays out.

        I’d also not that the 70% figure is for fixed expenses. What’s a fixed expense? Something you can’t eliminate/reduce easily. House payment? Fixed. Car payment? Fixed. Utilities? Mostly fixed. You have cable/dish and aren’t on a long term contract? Not fixed. Groceries? Subtract the expensive food you can do without, that’s fixed.

        How do you reach this? Live in less house than you can afford. Drive less car. Do they need that vehicle, or would a smaller one work?

        My thing: 70% fixed expense limit(can be less), 10% towards retirement, 10% towards ’emergencies’. 10% to have fun* with, take advantage of deals, etc… Emergency isn’t that great deal on a purse, it’s more your car broke down and you need to get it fixed. You lost your job, etc… Little emergencies take up the 10% variable money first, then the emergency fund contribution, then the fund itself… In case of a lost job, stop contributing to retirement/emergency fund, cut expenses, etc…

        *Life without some fun isn’t worth it.
        Note that the OP needed a vehicle and did the prudent thing by purchasing used not new.

        I see nothing in the main article that specifies they had a real NEED to purchase a vehicle, just that they were doing so. I phrased my statement very carefully in light of this – I have no knowledge of whether it was necessary or not.

        As for purchasing used vs new, in my experience I get better deals with new vehicles. Then again, I aim to keep them for more than a decade.

        I have no doubt the paperwork was messed up somewhere,

        • BridgetPentheus says:

          I agree with having a reserve, I have lived very conservatively on a small salary, enough so that when I bought my home I had more than a years worth of expenses saved away in case something happened. However my savings are fast being depleted as I have lost my job, need to pay cobra and have many medical expenses that I can not afford. That’s why my husband and I are moving back to his home country (Sweden) in March, no one should ever have to go into bankruptcy because of medical expenses. If you buy that car, home, boat, clothes, etc you can’t afford I have no sympathy for you, you’ll get bailed out but for those of us who go broke b/c of the medical system in this country, I feel sorry for the generations to come.

          • Firethorn says:

            You did good then. It’s not possible to have a reserve big enough to cover anything. After the reserve you should have insurance. Heck, you can consider unemployment to be a form of compulsory insurance, and I explicitly depend upon that.

            After a point, you do what you have to do.

  8. Acolyte says:

    This is not pile on the OP time but I have to ask, was OP laid off before or after he bought the truck? Also why buy a new car when you dont have at least one month’s payment in the bank in case anything happens? Maybe OP needs to see what he can do to get the extra payment, bite the bullet and see if he can sell off the truck and get a cheaper used car. Because unless he gets another job, things are not going to get rosier.

    • nullrout says:

      For real! I work for the federal goverment and have a very stable job and make good money…I could afford a new car if I really thought it was neccessary…instead I drive a 1996 Ford Escort. Paid cash for it 5 years ago…but I do have six months expenses saved up…because I haven’t had a car payment for over ten years.

      But oh, old cars require maintenance and I need something reliable…its still cheaper to rent a car once in a while when my Escort is in the shop than to have a $500 a month car payment!

      Seriously people, get over how important a new shiny car is…I don’t get pissed off when I see door dings…I laugh because some shlub most likely chipped the paint on his new car when he dented mine.

      • Acolyte says:

        I recently had to get another used car after my 1995 Honda died on me, with the mileage I had on it my insurance payments each year were equal to the cost of the car lol. I opted for another Honda that had over 100k miles on it, I will be done paying it in 1.5 years as opposed to the 60-72 month hole most people are trapped in.

        Anyway too many people buy more car than they can handle when times get rough. I do hope things work out for the OP.

    • JiminyChristmas says:

      I don’t think it matters when he was laid off relative to when he bought the car. If you have so little savings or cash flow that you can’t come up with one extra car payment…maybe you should buy a cheaper car, or not buy a new one at all.

      That said, if your only car totally craps out and you need one to get to work (or job interviews), I don’t know what you do except take on payments for another one and hope for the best. Public transit is so lame in most parts of the US you can’t get by without a car.

  9. Winter White says:

    The title of this article is vaguely inaccurate– it’s fairly clear that the “phantom” payment does exist and it’s for the month he drove a car that he believes he didn’t have a loan for.

    If he hadn’t traded in the truck, that payment would have been due. At all times, there was a loan out for a car…what the OP should have done was PAY the truck payment even though it was technically not the right loan, and straightened that out later.

    Now he really is a month behind because the bank simply replaced the truck loan with an SUV loan…it doesn’t make sense for them to date the loan to the date of correction, it would have to be dated to the date of purchase of the vehicle in order for the dealership to get their money.

    As far as I’m concerned, the financial circumstances bit is a red herring…you took out the loan, and you have to pay on it…what happened to the money that was supposed to pay the first month’s payment? was it spent when you figured you didn’t have to pay it?

    Remember, this isn’t monopoly, there are no bank errors in your favor.

  10. Skellbasher says:

    “This put a month behind, which ==>we thought

    I’m generally not on the point the finger at the OP, but to me, that statement clearly means they made an assumption that turned out to be erroneous.

    While the constant phone calls and such may in fact be a burden, that comes with the territory when you’re behind on a vehicle loan. As long as they are not breaking any of the FDCPA regulations in calling them, I don’t think Wachovia is in the wrong here.

  11. Muthafodder says:

    I can’t believe this garbled mess was posted without further clarification from Richard.

    “Through the return and purchase your finance company, after I paid my first payment on time paid off the wrong vehicle and was still sending us payments for the Dodge instead of the Chevrolet (which they had already paid off).”

    WTF is that…did he pay the first month or not…or was the first payment in his eyes what commenter are speculating to be the second payment after the finance company fixed the loan.

    All of these comments are just speculation…we don’t know what happened and it’s hard to take sides/give criticism with this poorly worded story.

  12. ben says:

    There’s really not enough information here for me to figure out exactly what is going on. Obviously the bank made a mistake initially, but after it was corrected, it’s hard to see what actually happened. He says that he’s being “harassed,” but it’s not clear what that means. He says he added $30 and $70, but “this seems to not be enough for your company.” I’m not sure what he’s expecting there. You can’t just decide to randomly pay what you want and hope they accept it. In the absence of any other agreement with the bank, he’s responsible for the full payment each month. It’s unfortunate that he lost his job, and even though he apparently wasn’t billed while the mistake was sorted out, he should have realized that he was going to have to make that month’s payment. There was no reason to assume that they would shift the loan by a month unless they indicated that to him at some point.

  13. Talisker says:

    If I was in the OP’s situation, I wouldn’t have had the problem in the first place because I don’t borrow money to buy cars. If I had borrowed money to buy a car that I couldn’t afford, I would sell the car, pay off the loan, and buy a beater then start saving up for a better car. Especially since I’m laid off. I have a feeling that the OP is probably upside down on the car loan, though.

    • Acolyte says:

      If it’s a new car, the dude is major ways upside down as the car loses 20% plus of the value as soon as you drive it out of the lot. If its a used car he may have a better chance of bouncing back minus of course all those fees and taxes that dealerships tack onto car purchases. All in all borrowing to buy a car without any short term savings is not the best idea but if he had to get around, it is what it is.

  14. phonebem says:

    Wow, nothing like piling-on the OP… Why am I the only one who sees the fallacy of Wachovia hastling the OP for a payment they had no way to make, ie. no account #, no where to send the check, anything… Everything else is secondary to that point.
    Has anyone even considered the fact that circumstances have changed for the OP between the time of purchase and the resolution of the problem, or the possibility that any safety net was used to pay-off any other debts and to cover the lag between his layoff and starting unemployment benefits? None of that is really anyones buisiness since it wasn’t mentioned.

    • BridgetPentheus says:

      I’m not going to comment on the OP, it’s very hard to pay a loan where you have no loan number, address, amount, etc. This happened to me when I bought my first place. At closing in March the mortgage was paid until May. However despite having my mortgage on my place they couldn’t seem to be able to address the bill correctly, I had no loan #, no address to send it to, no payment coupon(yeah remember the days where you got the 30 year payment book upfront) I hounded the company (US bank don’t deal with them) for help, I was told they had too many customers to be able to help me and to pay it online. (which wouldn’t have been a problem except it only worked on IE 7, I have a Mac and at the time worked in a place that ONLY had Macs and Mac OS) It shouldn’t have taken so many days of my energy for them to give me a bill to pay. So I’m sorry Wachovia takes part of the blame here. I took to paying my mortgage for a few months in advance at a time just to not have to deal with them. Sometimes you can have the money in your hand and they won’t touch it.

  15. NydiaGeben says:

    He knew he owed a car payment on the 2nd car. I’m sure the auto contract didn’t say he gets the first month payment waived. … So what happened to the money to make the car payment on the 2nd car?

  16. Incident8 says:

    I have never understood why anyone would go to a bank whos name is literally “Walk Over Ya”.

  17. howie_in_az says:

    This doesn’t surprise me at all. I’ve been dealing with Wachovia for a few years, triple paying on my loan. Every month I have to phone them and tell them to apply the extra two payments towards principle and not prepay the next two months. Every month they say I should add something to my checks, and every month I inform them that I’ve been doing that since the origination of the loan. This, of course, is after they illegally reversed the interest rate on me; I had refinanced to a lower interest rate but refused to sign the binding arbitration agreement. Wachovia accepted two payments on the new loan before reversing the whole thing.

    They are the worst company I have ever had a loan through.

  18. scoosdad says:

    Figures. Wachovia is the bank that acquired a home equity line of credit that I had until recently. Even though they were sending me monthly statements and an 800 number to call in case of questions, when I called, nobody there even knew I had a HELOC with them, or how to answer my questions about it. They kept giving me more and more obscure bank 800 numbers to call instead, and of course nobody there knew what to do with me either.

    The only way I finally got a real number and someone to talk to about it was when they sent me a letter telling me they weren’t renewing my line of credit after its initial five year draw period.

  19. JonBoy470 says:

    I’m sorry, but Wachovia paying off the wrong car loan is just mind-numbingly bone-headed. Not quite to the level of the doctor who removed the wrong kidney, but in the same league. Wachovia should be the one fixing this problem in a manner that is transparent to the OP.

  20. Ronin Democrat says:

    I would man up and rob a bank to get them their money.

  21. Extractor says:

    What language was that letter written in?