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Gap insurance is refusing to pay the remaining balance for my totaled car. What can I do?

Dallas, TX |
Filed under: Car loan

My car was totaled out in September 2013. Geico paid my credit union $5600. My credit union stated I still owe $1600. I have gap but the said they don't owe anything because their pay off amount was $4900. But my credit union stated that my pay off amount is $7200. Now today my credit union stated that I have to pay the difference of $1600. I have never missed a payment. What should I do now?

Attorney Answers 4

Posted

I don't understand why there are different opinions on what your pay-off amount is??? I would have your credit union get you written proof of your loan balance (preferably an itemized payment history) and send that information to your gap carrier. If you still cannot get it resolved, contact a local attorney for a free consultation and go from there.

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Asker

Posted

That's what im trying to figure out too because I haven't missed any payments. The gap insurance people sent the letter to my credit union with a list of payments and why they don't owe anything. My credit union haven't explained anything.

Robert C. Slim

Robert C. Slim

Posted

I would think the credit union has the information on your loan history. I don't understand why the gap carrier would be submitting your payment history to the credit union. It should be the other way around.

Asker

Posted

Hopefully if my credit union would call me back or answer my calls tomorrow, I get some answers from from. I don't understand how I would be responsible for the remaining balance of $1600 and why there are two different payoff amounts.

Robert C. Slim

Robert C. Slim

Posted

I don't think the gap carrier is saying you are responsible for the balance. They are just disputing that you even have a balance. Once that issue is resolved, everything should fall into place.

Asker

Posted

I finally found out what the problem was. The GAP insurance people was going off my original loan and not my refinanced loan. My credit union faxed me a copy of my payment history and I faxed it to my GAP and now they are saying that they are still not going to pay anything. GAP is now stating that my allowable amount to finance should be 2,000 less than what it was actually financed and because of that they don't have to pay the remaining balance. So no I'm completely lost!

Posted

You may want to contact an insurance lawyer

Eric Dick, LL.M.; LEGAL DISCLAIMER: Mr. Dick is licensed to practice law in Texas and his office located in Harris County. Mr. Dick primarily practices insurance law in Texas and offers free consultations. Mr. Dick is ethically required to state that the response herein is not legal advice and does not create an attorney client relationship. These responses are only in the form of legal education and are intended to only provide general information about the matter within the question. Often times the question does not include significant and important facts and timelines that if known could significantly change the reply or make such reply unsuitable. Mr. Dick strongly advises the questioner to confer with an attorney in his or her state in order to ensure proper advice is received. By using this site you understand and agree that there is no attorney client relationship or confidentiality between you and the attorney responding. This site should not be used as a substitute for competent legal advice from a licensed attorney that practices in the subject area in your jurisdiction, who is familiar with your specific facts and all of the circumstances and with whom you have an attorney client relationship. The law changes frequently and varies from jurisdiction to jurisdiction. The information and materials provided are general in nature, and may not apply to a specific factual or legal circumstance described in the question or omitted from the question. Circular 230 Disclaimer - Any information in this comment may not be used to eliminate or reduce penalties by the IRS or any other governmental agency.

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Posted

Thank you!. I finally found out why it was two different payoff amounts and got that straighten out. They are now stating that my car was over financed by 86%. So now they won't pay 120% of the net payoff, they are paying 86% which means they are not going to pay anything off my remaining balance. If the contract states they will pay 120% can they only pay 86% if they are stating that my car was over financed?

Posted

Have your credit union representative contact the claims adjuster for your GAP insurance claim. Usually, GAP insurance covers the difference between what a car owner owes and what his/her car is actually worth, and in sometimes, it covers regular auto insurance deductibles, as well. You may also seek a free consultation from an attorney who specializes in insurance law/diminished value law. AVVO provides "Find a Lawyer" search for attorneys in your state/area, Good luck.

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Posted

Thank you!

Christopher Andrew Gaj

Christopher Andrew Gaj

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You're welcome. If you find my answer helpful, please click the button accordingly.

Asker

Posted

Thank you!. I finally found out why it was two different payoff amounts and got that straighten out. They are now stating that my car was over financed by 86%. So now they won't pay 120% of the net payoff, they are paying 86% which means they are not going to pay anything off my remaining balance. If the contract states they will pay 120% can they only pay 86% if they are stating that my car was over financed?

Christopher Andrew Gaj

Christopher Andrew Gaj

Posted

You should be entitled to what was agreed upon in the written contract. However, it would be best for your to seek a free consultation with a Texas licensed attorney who specializes in contract law. He/she will have to review the contract/agreement and its terms to give you a complete and accurate analysis. Good luck, you're doing great.

Posted

I'm a former insurance adjuster then supervisor and and eventually an Insurance claims mgr. where I handled and or managed thousands of claims. However, for the last 15 years I have only represented people with claims covered by insurance and handled by my old coworkers.

Demand a certified copy of your policy and a written explanation from the adjuster explaining the basis of their position. Do this in writing via certified mail. Ask for their communication back with you to quote the policy language and give the page and paragraph they are relying on to pay less than the payoff.

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Posted

Thank you!. I finally found out why it was two different payoff amounts and got that straighten out. They are now stating that my car was over financed by 86%. So now they won't pay 120% of the net payoff, they are paying 86% which means they are not going to pay anything off my remaining balance. If the contract states they will pay 120% can they only pay 86% if they are stating that my car was over financed?

Ernest Eugene Warhurst Jr.

Ernest Eugene Warhurst Jr.

Posted

I really need to review the contract. Feel free to email me the policy with the particulars and what they are telling you and what your question is and I'll help. Gene@WarhurstLaw.com

Asker

Posted

Can I fax it to you?

Asker

Posted

I just e-mailed you the contract.

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