Expert: Doctor Settlement - 8/31/2006

Question
Hi,
My car was broken into and they stole some personal belongings as well as the rear removable seats (it's an SUV). My insurance company has issued a check payable to me and the bank in which the loan is through for repairs. The check amount is for $7,000. The estimate was made by a dealership. I have found the seats online for much cheaper, but my bank will not sign the check over to me until the repairs are done and I don't have the money up front to order the seats. I'm not sure what I should do?
Thanks!

Answer

Dear Kelly,

That kind of "service" is the reason Dr. Settlement always looks for a community or local bank.  There are REAL people there who will cooperate to make something like this happen.

I wonder how much of the check was for your personal items lost, inasmuch as those were yours, and you should have that money paid directly to you.

Here is how I would look at your situation.  First is how much you still owe on the vehicle, and second is your past payment history.  Those two things will tell the banker if she has much wiggle room to accomodate you in this respect.

As I am sure you know, the bank has an interest in seeing that its security does not diminish in value.  Thus, they want the same or better replacement.  

I would ask to speak with the bank manager.  Bring her the WRITTEN proof of the seats and price, including photos, etc.  She needs you as a customer, so she should want to work with you.

Then I would try three things, BUT each of them will cost at least $100 each.  So it depends upon how much the savings is for you.  You are correct in that whatever the savings is, you get to pocket the difference.

First is to create some kind of escrow to take the check and to pay for the seats.  I would create the escrow documents and make the bank the escrow.  They may just see this as too much work and give up, who knows?

Anyway, here is what the escrow documents would say.  1) recite facts regarding the check and the savings available for purchase of the seats;  2)agree that you will sign the check over to the bank; 3)you will show purchase means to bank and they will send payment to the seller via your checkiing account or your credit card; 4) bank will arrange for the seats to arrive and be installed and the vehicle to be inspected.  5) they will pay over the difference to you, less a fee of (hopefully make it ZERO, but in all liklihood, it will have to be $100).

Second, a young and hungry attorney might do this, but cost will be at least 1.5 hours times her rate.  Of course, if you were to create the escrow documents, then the attorney might do it for less.

Third, go ahead and apply for a loan to buy the seats.  Use the insurance check as collateral if need be.  Then buy the seats, pay off the loan, and pocket the difference.  Cost will be around $100.

Hope these ideas are of some help to you, and next time do as I do: stick with the local folks who opened a local bank; their debit cards are still  good around the world, and they will take care of you!

Best Wishes,

Dr. Settlement, J.D. (Juris Doctor)
http://www.SettlementCentral.Com