Complaint Review: Americredit Financial Services Inc. - Internet

First off, I'd like to thank  Jim, Robert, and Ronnie for the posts.  I didn't mean to get a heated response going, and for that I apologize.  I really do appreciate your comments, albeit good or bad.  I just want the truth or experience from anyone in this situation.  I do have some rebuttals/comments regarding the facts of the situation:

 1.  My husband does work two jobs already and has done so, along with going to interviews to get a more decent job (which isn't easy because he gets maybe 4 hours of sleep a day.  He has a BS in Business Administration and, maybe because of his age (63 yrs old) or whatever, he doesn't get a call back.  I can only "presume" that ("assume" makes an a*s-of-u-and me) based on the date he graduated and the years that he would be since the graduation date and now.  It could be because we're not one of the "good ole boy's club" down here.  The two jobs he currently has (which he has gotten cut down paychecks because of the economy, for all the years we've been married, he has never gone without a job with full benefits, a decent wage, etc. 

Now, he  works as a delivery courier from  midnight to 8:30 a.m. deliving newspapers to your front door.  Right after that job, he work, at McDonald's and is lucky to get four or five hours of sleep.  And, the paper delivery job, is done in the wee hours of the morning, not 5 days a week, but, 7 days a week. So, I don't believe he is sitting on his laurels, doing nothiing.  He is rapidly losing his energy and I worry about him every single day. 

3.  We were never notified by AmeriCredit about an auction nor any collection letters even though we tried to get through to them to make payment arrangements.  The fact that the money they got from a person who works for AmeriCredit and not sold at auction, was information they told my husband, not the other way around.

It's not like we had moved from our residence in the last nine years, so they clearly knew how to write us, or even call us.  We were also never told the deficiency balance but only guessed at it.  We could never find out what it was because their automated system didn't have that information in their files and when calling AmeriCredit about it, that's when we found out it had been sold to an employee of AmeriCredit. 

Again, I thank you for responding to my question.  We do appreciate it. 

Pace e Bene!

Patti Fleming, SFO

"So the know it all experts come to the "rescue"..in typical fashion of belittling, condescending and insulting the posters for simply not understanding..and myself for trying to show a little compassion. "

 So, what you're saying is that although you may be giving bad advice to a poster and may be confusing the issue by questioning the posters who are actually giving the O.P. good advice, it's OK because you're compassionate. Just like Karl's posts are OK because, even though they don't make much sense, he's really trying to be helpful. You're in good company.

And if so..why was he/she not contacted by the lender, any collection agency, or the IRS until NINE YEARS later? Is this not a reasonable question?

- It would be if you didn't read the original post where they stated that says they immediately tried to collect the deficiency balance.  That it has been placed on their credit reports.  I would also venture a guess that each time the debt was sold they were "notified" that the debt was still owed.

I just see no point to leaving any response other then will help this poster to understand...

- Ronny your responses saying to "ride it out" or that it may be a scam did NOTHING to help the poster. Telling them to contact the IRS to see if the debt is legitimate did nothing to help them.  This only confuses them in their situation.  Not everything is all happy faces and smiles, sorry but it just is not.  If someone got into a financial situation there are certain remedies creditors can and will take.  One of those remedies is to write off the debt to the IRS, and in this case they already stated that they are going to write it off.  Which is why the part was posted as to that may actually not be as bad as they thought, especially if their tax bracket is low.  Whether you think you are well meaning or not, posting incorrect or incomplete information does not help.

Telling them that the IRS can not force you to pay more is nieve at best, at worst could get them in more trouble by having the poster think that the IRS can take no further action against them.

Most likely they did not get sued because Americredit probably figured that the chances of them getting paid on the judgment was very low.  This is especially evident as they appear to be in this same financial situation for 9 years.  In the end this person needs to be a bit grateful that Americredit did not sue.  Had they actually sued for the balance.  Not only would they owe the full amount, but additional court and legal fees.  Instead they are only having to pay the tax on the amount that was written off.

Once again...I find myself here defending myself and others for being disrespected for reporting here.

I know some of you blame anyone who defaults on a loan...or overdrafts with a checking account is the cause of all the countries problems today. Now this is not to say there are not many people that do live beyond their means ..and can be a burden to society..I can not disagree with that.

However, there are cases where people lose their jobs..or situations beyond someones control the causes bankruptcies, loan defaults and overdrafting. Not all these people had bad intent..and thank GOD..we live in a country that forgives these types of instances.

Because if you want to live in a place that show no forgiveness or tolerance...I am sure there is plenty of vacancy in parts of the middle east and other countries where you can move to. And maybe you can get the job of cutting off peoples hands who can't afford to pay back a loan.

Flynrider..forgive me for trying to help. At least I had respect in my replies and tried to cover all bases.

It just seems apparent to me by the POSTERS report..that the debit was charged off..and the car was already sold. So what makes you  think Americredit had any "hope" it was going to get paid off?

I never said I was perfect..so I have a right to question something that seems fishy to me. I had never heard of this happening after nines years..and apparently neither has the poster.

So the know it all experts come to the "rescue"..in typical fashion of belittling, condescending and insulting the posters for simply not understanding..and myself for trying to show a little compassion.

Hope you all got your cheap thrill. Seems no other way to satisfy some egos here.

    You've jumped in to "help" the O.P. without having any idea what you're talking about.   Now you are quibbling with those responses that were actually factual and informative.  Who needs that kind of "help"?

"I personally just wonder why it took NINE YEARS before anyone notified this poster there were any taxes due, if any actually are. "

  Do you still not get this?   The taxes will not be due until Americredit writes off the bad loan and notifies the debtor with a 1099 form.   For the past nine years, Americredit has been carrying this bad loan on their books, perhaps in the hope that they could one day collect.    Now they are officially giving up.  The O.P. is being given a gift, but like with many gifts, the Feds would like taxes paid on it.

As I stated earlier, I was not put on this earth to defend this poster or rebut anyone over this case..I am simply trying to help this poster and understand the charges.
Regardless of all the presumptions about this poster...I personally just wonder why it took NINE YEARS before anyone notified this poster there were any taxes due, if any actually are.

And if so..why was he/she not contacted by the lender, any collection agency, or the IRS until NINE YEARS later? Is this not a reasonable question?

I understand to some people the fact that this is the WORST recession in recorded history is not an excuse...nor should any "sub prime" lenders be so "shocked" when a repossession occurs...but normally I would think that when requesting a creditor to "come get the vehicle"..it would within a reasonable assumption that they would let the consumer know they may be liable for taxes.

Now since I have never been in this situation, I have never heard of this. It took me investigation to figure it out..why was it hidden from this poster for NINE YEARS.?.and now with times being so much worse...and posting here that they need help....they have to get responses that are harsh and simply cruel in my opinion. Forgive me for having a soul and conscience. I just see no point to leaving any response other then will help this poster to understand...I guess it is easy to judge others when we are not the one walking in the shoes. I see it as cowardly to leave a response for no reason other then to make someone who already feels bad..feel "more" bad..how does this help anyone?

Simple questions.

Okay it is hard to say the order of these posts so I will just try and hit some basic facts.

First ACF IS a Sub-Prime lender as Jim Stated.  They are not one of the "bottom of the barrel" lenders.  But still deal with the Sub-Prime market.  It would be extremely rare for a person who had average or above credit to be with AmeriCredit.

As for the actual Repossession.  A Repo is a Repo.  It does not matter if you turn it in or they come and get it.  Except for the possibility of saving some of the actual repo fees, the effect is the same.  The sale of the vehicle was most likely valid as they auctioned it off.  When this happens you will never get more than about 25%-33% of the cars Blue Book Value, which for most people is way below the actual loan balance.

Now, just yesterday, again 9 years later they are telling us they are reporting the balance as income received by us to the IRS! What? How can they charge it off and use that as a deduction for their business taxes, sell the account and we don't get credit, and then 9 years later say they're filing this paperwork?

- Credit for what?  You got a loan and agreed to may payments at a set time for a set amount.  For what ever reason you FAILED to meet your obligation.  Since you did not pay the deficiency balance the IRS allows them to take this as a deduction.  But as with anything else if there is a deduction on one side, there is an addition on another.  In this case you get hit with the addition.  This is no different than if you had made a loan to someone and that person failed to pay you back.  You could take that as a deduction and the IRS would go after the other party for the additional taxes on the amount you wrote off. 

These do not appear to be "back taxes" which would be an entirely different matter.  These are taxes that will be due on an item that is reported to the IRS.  If they were "back taxes" it would be the IRS not Americredit sending them the letter, and they would be in a lot more trouble.

If they have already reported to the IRS it there is no "riding it out".  Expect to receive a 1099-C in January for the amount they wrote off.  The IRS will have no information on this debt until they get the information from AmeriCredit.  This probably will not occur until sometime in 2010.  Hopefully Americredit told you what the amount will be before that. 

Now to the "you may not even have to worry about it" category.  Since this is treated as income you would only pay taxes based on your tax bracket.  So if your tax bracket is 10% and they wrote off $1500 you would only owe $150.  If even with this amount you don't hit the minimum threshold for taxes you will owe nothing.   A good guide is if you know the amount use your last years taxes to figure out the expected tax you may have to pay.  It won't be exact but give you a good guide if your situation is similar.  If you have an idea of how much you are going to owe since you have until April to pay, it might be good to try and budget that in over the next 6 months.

I just had to mention something about the following statement.

I know times are hard..but if you can only afford 10 dollars a month...they can't force you to pay more..and I highly doubt they will try to lock you up for this or make a federal case...they have much bigger fish to fry.

If you are unable to pay will they lock you up..No.  But if you are unable to pay unlike consumer debt the IRS CAN garnish your wages in EVERY state.  They can attach your bank accounts, and again unlike consumer debt they CAN seize property.  If you have a refund due in future years they will intercept it until the taxes are paid.   So if for what ever reason you can't get the taxes you owe paid by April it would be to your advantage to pay as much as possible and then work out a payment plan with them in advance for the remaining amount.

This is not being rough on you this is just the way it is.  It is also no different than any other lender probably would have treated you in the same situation.

ACF is a sub-prime lender.  If a customer has prime credit, then a major or community bank will be the lender.

Being cruel is telling someone what they want to hear, stroking them or some other type of nonsense which does nothing but help promote or encourage the faulty thinking/actions which caused the problem in the first place.  It will be a cold day in a very hot place when I don't tell it like it is rather than be telling someone what they want to hear. 

What I said in my original post is right on target.  From reading and re-reading the original poster's complaint about ACF, it is clear to me he/she doesn't understand certain aspects of finance and it further appears this poster, (as well as many others) seem to think giving up the car in a voluntary repo resolves everthing and any further action by the lender is so-o-o-o unusual, outlandish, unethical or criminal.  It clearly isn't.

Now let me also add, I'm not writing from some type of ivory tower life!  I've been there as a sub-prime borrower who was forced to deal with a sub-prime lender not because of alleged bad financial times but because of my own damned stupidity and my unwillingness to be responsible.  I learned my lesson and I speak from a 100% position of experience.  I do not and simply will not accept some song and dance "there's nothing that can be done" or "there are no jobs".  Again, that's pure, 100% BS.  Unemployment may be at a national rate of just over 10%, but that means 90% have jobs.  As a part of learning to be responsible, I took on not just a weekend job but weekday part time jobs in order to pay off my grossly overdue bills.  I'm no super human and if I can do it, so can anyone else! 

I fully understood I was a sub-prime borrower and I was that BECAUSE I CAUSED IT!  I've been thru many so called bad financial times but always had a job and many times several because I was willing to work rather than look for some "magic pill" to solve my financial problems. 

Being a sub-prime borrower can be a humbling and educational experience...like paying a tuition for a lesson in life.  A responsible, mature and willing to learn person can come thru that experience a better person.  However, far too many sub-prime borrowers continue in their "sub-prime" ways, learn nothing and when the lender takes their actions to protect their interests, that'as so, so bad.

As far as this CRAP about an "inside sale" whatever the hell that's supposed to mean or divert attention from...as I said before, the lender will sell the collateral at auction and try to get as much for it as they can which WILL NOT cover the amount the sub-prime borrower AGREED TO PAY as per the SIGNED CONTRACT.  The amount left over is the "DEFICIENCY" and the lender will and should go after the sub-prime borrower because that borrower AGREED to pay the entire amount of the cost of the vehicle plus interest plus any late or other fees.  That my friend is BASIC FINANCE 101.

I do not understand why you are being so harsh to this poster.

You have no evidence whatsoever that this was a "sub prime" borrower..and you accuse this poster of stating this event was outlandish, illegal or unethical. All this poster did was state the facts of their situation, state that they are losing sleep over it,  (you have heard we are in the worst recession in recorded history, right?), hours and paychecks are being cut, and that they are not even able to maintain a paycheck to paycheck existence..thank you for the decency and basic human compassion.

Agreed the poster made the assumption the sale of the car was an "inside" sale..but how does that assumption effect you personally? Maybe it was an inside sale...is that so unreasonable to assume?...even if it has no bearing on the posters case.

This is a 9 year old issue..and apparently if they do owe any back taxes..they were unaware until now. Why were they not notified sooner if this is the case? Why 9 years later?

Anyhow...I am was not put on earth to defend them or rebut you...but at the end of your nasty reply you wrote..."Why didn't he get a second job or work part time to cover the payment rather than further ruin your credit with a repo?"

The OP states at the end of the report.." We are in such bad shape because my spouse, who now has two jobs, keeps getting hours and paycuts, right and left."

I do not notice this poster complaining about credit ratings...but only not understanding while after 9 years..they are all of a sudden intimidated over an old debt during a time when they are seriously just struggling to survive, and asking for some help.

Why does this bother you so much? If you can't offer advice to help ..why say anything? Did you get that much personal gratification from being cruel?

I investigated further since I wanted to make sure I was not giving the wrong advice...this is what I found...

After the vehicle is repossessed
If you are unable to make an arrangement with your lender and do not make your payments, eventually they can take the next step and hire someone to repossess the vehicle. Once that happens, you have the right to reinstate the contract by paying all past due installments, late fees, and costs the lender has incurred in repossessing and storing the property.

If you are unable to reinstate the contract, the lender will then sell the car at auction. They will notify you of the auction date, and you may attend and bid on your vehicle. Whether you or someone else buys it, however, you will be responsible for the deficiency balance if the vehicle sells for less than the loan amount. A deficiency balance is the difference between the amount that you owed on the loan and the price the vehicle sold for at auction plus repossession, storage, and auction costs.

This deficiency balance is an unsecured debt. Some lenders may sue for this sum, while others may forgive it. If the lender does forgive it, the IRS will consider that amount income, and will assess tax due.

Now I can not say with any certainty if the statute of limitation applies to this kind of tax..but you might want to look into what the "deficiency" balance was..if any..and what the amount of tax applied to that balance should be.

If there is any chance you are responsible for this tax..I do not suggest you mess around with the IRS. Simply ask the debtor for any information regarding this "tax",  and contact the IRS directly to make sure you are not getting scammed...and if it turns out you do owe anything..work out a payment plan. They are generally more then willing to work out something within you means as long as you do not miss payments. I again advise to not admitting you owe ANYTHING to the debtor..but simply ask for any IRS info..if this is legitimate..they should have no problem.

Do not lose sleep over this..it is peanuts..do not let this company intimidate you. The IRS will ask what you what can afford if you do legitimately owe any income tax for this vehicle...and take it from there. I know times are hard..but if you can only afford 10 dollars a month...they can't force you to pay more..and I highly doubt they will try to lock you up for this or make a federal case...they have much bigger fish to fry.

Now if this "debt" is actually being charged to you by the IRS...there is a 10-year statute of limitations for the IRS collecting tax. So if you are not far from the 10 years..if you do not feel it is unethical..try to ride it out. However since this may not be a 'tax" issue per say..I do not understand how the IRS or anyone can consider you losing the vehicle as "income"..since apparently you did not financially profit off the loss or resale of the vehicle. But it appears more to me by your report..that this is possibly what is know as a "scavenger debt collecto r"..and if so, they have no right to be hounding you. Even if this was a legitimate debt collector..the statute of limitations on any written debt contract or agreement is 4 years maximum in California ..so you are legally free and clear... DO NOT ADMIT THAT YOU OWE THE DEBT, DO NOT AGREE TO PAY THE DEBT, AND DO NOT AGREE TO SEND ANY MONEY TO THEM . Read the following carefully... Statutes of Limitation on Debt Collection Are you being hounded by a debt collector for an old debt you thought was written off years ago?  If so, it is likely you are being contacted by a scavenger debt collector , which is a company that purchases older, mostly un-collectable debt for a tiny fraction of its value.  Scavenger debt collectors are notorious for using illegal and unethical methods to collect "time-barred" debt. You do not have to pay debt that is considered too old by your state.  Every state has laws governing the time in which a person or entity can file suit to collect a debt.  Generally, a creditor or debt collector gives up his right to file suit to collect a debt after a period of six years from the time the debt was written off (or the date of last activity on your credit report), but various states allow anywhere from 2 to 15 years to collect delinquent debt ( see statutes of limitation table below ).  The purpose of these statutes of limitation is to bring some measure of fairness to the debtor so that he / she (1) will not have to worry about being sued for the rest of their lives; and (2) so that the debtor can properly defend himself with fresh evidence and witnesses, if any.  This doesn't mean that a creditor cannot file suit against you after the statute of limitations has expired; however, if a creditor or debt collector does file suit, you can ask the judge to dismiss the suit on the grounds that the statute of limitations has expired.  In fact, if the statute of limitations is about to run on debt you owe, don't be surprised if you suddenly hear from a collection agency threatening to sue if you don't pay immediately.  If a debt collector contacts you regarding an old debt, do not admit that you owe the debt and do not agree to make any payments.  Simply tell them that the "statute of limitations has run on this debt and do not contact me again".  If they continue contacting you, send them a certified letter, return receipt requested, telling them not to contact you about the debt again.  Remember -- DO NOT ADMIT THAT YOU OWE THE DEBT, DO NOT AGREE TO PAY THE DEBT, AND DO NOT AGREE TO SEND ANY MONEY TO THEM .  If you do, then the statute of limitations might start running all over again, giving them the legal right to sue you.

This means the "income" reported to the IRS is income to be credited to you.

You go thru each step as if it was so outlandish, illegal or unethical, which it isn't.  You didn't fulfill your contractual responsibilities, without regard to the reason.  You gave back the car which is STILL a repo, yes, even if they didn't send the repo guy.  When a repo is sold at auction, it is COMMON PRACTICE to go after the amount remaining under the contract, because THIS IS WHAT YOU AGREED TO PAY!  The allegation about it being an "inside sale" is PURE B. S.  Repo's are sold at auction, not for the amount you contracted for, but for what the vehicle is worth at the time of the sale.

Sub-prime lenders are so-o-o- wonderful and understanding when they make loans to people with bad credit.  But when they are forced to take collections efforts when that sub-prime borrower doesn't pay, oh, that's a different story, right? 

You said you were unable to work due to your disability but your spouse wasn't making enough money to afford the payments.  Why didn't he get a second job or work part time to cover the payment rather than further ruin your credit with a repo?