After the account fell into arrears, the bank repossessed the vehicle. Seth said the bank should not have done this because later monthly payments had been made.

Our investigation

We reviewed the loan documents, the electronic signing records, the bank’s welcome letter, and messages between Seth and the dealership. We found Seth signed the bank’s loan contract. The contract identified the lender, set out the repayment structure, and said the borrower was responsible for insuring the vehicle. The welcome letter also referred to the large payment due three months into the loan term.

We listened to the call Seth relied on to say the bank agreed to refinance that large payment. The bank said it would look at refinancing it if the company made three monthly repayments to show it could service the loan. That was not an agreement to refinance. The next repayment was not made, so the bank did not have to refinance the payment.

As for whether the bank could repossess the vehicle, the large payment remained unpaid, so the account was still in default. The bank had a contractual right to take recovery action. However, we found the bank did not communicate clearly from late 2024 about the continuing arrears and recovery action. Even so, we considered clearer communication would probably not have led the company to pay the arrears and avoid recovery action. The large payment remained unpaid, and Seth continued to dispute the loan contract. We also found the bank was not responsible for the vehicle’s reduced value after a crash, the lack of insurance, or storage costs after the sale was suspended at Seth’s request.

Outcome

We did not uphold Seth’s complaint.