Expert: Richard Hixenbaugh - 9/27/2010

Question
Upon acquiring an auto loan in late '08 for a period of  24 months I was led to believe by the bank that I had insurance on my vehicle, otherwise I would not have gotten the loan.
Now at payoff time they have told me that I did not have insurance the first year and that I owed them $1000+ dollars in retroactive force placed auto insurance.
Is their any avenue I may pursue to overcome this seemingly injustice and their lack of due diligence or miscommunication?

Answer
Hi Tim,

The only way to get it reversed it for you to provide them with proof that you had full coverage insurance during the time frame they are charging you for.

All car loan agreements have a clause requiring you to provide them with proof of insurance without interuption duringf the term of the loan. If at any time they do not have proof of insurance or are notified by your insurance comapny that your policy has lapsed, they will purchase force placed insurance to protect their interests.

So in this case you have to either find the proof that you had insurance of your own, or pay them for the insurance that they purchased.

I hope this helps
Richard Hixenbaugh