Member Files Suit Over Value of Repo'd Vehicle

Register now

A member of Meriwest Credit Union has filed in state court here claiming MCU and a local auto dealer violated her rights when it repossessed her car and sold it at auction for a fraction of the fair market value. In her suit, Madelin Fleitas said she borrowed $18,400 in November 2001 from the CU to buy a 1997 Volkswagen Cabrio from the local Nissan dealer, but ceased making payments after a year and asked MCU to take it. Meriwest then sold the vehicle for $4,000, less than half its wholesale value, at a private auction, then served Fleitas with a deficiency judgment of $13,200. California law requires that repossessed property must be disposed of in a commercially reasonable way, with the proceeds from the sale applied to the outstanding balance on any debt on the property.

For reprint and licensing requests for this article, click here.
MORE FROM AMERICAN BANKER