My dealership closed after I bought a car – I’ve never missed a payment, but I fear it will be charged at any time

Car buyers panicked after the dealership where they bought their car suddenly closed – many feared their car would be repossessed.

Without a reliable way to pay off their car loan, many assumed the worst.

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American Car Center, a used car dealership in Huntsville, Alabama, closed without warning last year.

Many car buyers financed new cars through the company, and with the closure and no instructions on how to pay, many feared they would face serious consequences for missing payments.

Even though it wasn’t their fault, they missed a payment.

Brandy Hardic purchased a car from the dealership and expressed her fear that the car would be repossessed.

“I’m nervous. I’m scared of what’s going to happen,” she told CBC affiliate WHO.

“Are they going to take our car? Will we be responsible for late fees or anything else?”

Looking at the worst-case scenario, Hardic said his family wouldn’t be able to afford another car.

“We cannot bring in another car. We can’t afford extra payments,” she continued.

“We will have to maintain insurance on this vehicle. If they decide they won’t take our money, what should I do when it comes time to renew our tags?

This is not the first time that drivers were confused when a used car dealership suddenly closed without leaving instructions on how to pay your loans.

Hunter Allen and 34 other drivers were shocked when ByrdDawg Motors in Idaho closed without informing those who financed vehicles through them.

Allen and the other drivers participated in a lawsuit against the dealership, which subsequently lost its license after it was discovered that it never issued titles to buyers.

The other drivers were paid, but Allen only received a few hundred dollars, leaving him with $20,000 to pay for a car he didn’t officially own.

In Hardic’s case, she felt a bit of relief when the American Car Center posted an update on its website a few days after the closing.

The website gave drivers instructions on how to make loan payments online, or they could call a phone number.

Tips for buying a used car

When shopping for a used car, the experts at US News & World Report offer some tips before you hit the sales lot.

1. Set a realistic budget. Some cars are more expensive to insure and register than others, depending on the engine type, body style, weight and number of doors. Before you get ripped off by a slick salesman, it’s important to know what you can and can’t afford.
2. Researching which car best fits your lifestyle can save you a lot of time. Would a sedan work better for your garage or narrow street? Would a truck meet transportation or towing needs? Knowing what meets your needs can narrow down your options.
3. Look for certified pre-owned cars. Certified pre-owned cars are backed by the manufacturer and come with comprehensive warranties at affordable prices. Some manufacturers have better deals on CPO cars, so shop around carefully.
4. Not all financing options are created equal. Depending on where you intend to finance, if this is on the table, be very careful about who you finance. Your best option would be to get pre-approved by your bank before coming in to get an idea of ​​what rates are affordable and give the dealership an incentive to meet or beat those rates.
5. Consider a used car inspection. Depending on where you are purchasing a vehicle, you may choose to pay around $200 for a used car inspection to have key components examined by an expert.
6. Consider a vehicle history report. When things get close to signing, purchasing a VIN-based vehicle history report can help shed light on previous owners, maintenance records (if it was taken to a dealership), title status and more.

Source: US News and World Report

There was even an option for drivers to bring a physical check to a specific location.

However, some drivers remained wary of the new payment system.

A lawyer told drivers to always have their payment amounts stored somewhere safe.

“Someone is going to take on these debts and receive ownership of the bonds and at that point they will contact and get a list of all the people,” said attorney Russell Crumbley.

A solution would emerge soon, Crumbley said, as financial institutions would be eager to collect payments.

“They will contact you and give you instructions on how to resume your payments. And ideally, if four months from now you owe that money, you’ve set aside four months’ worth of it and it won’t come as a hardship. You have planned the payment. Make the payment, just set it aside.