Ally Financial Repossession Lawsuit 2021: What You Need to Know

In 2021, Ally Financial, a major auto lender, faced a class-action lawsuit that raised questions about their repossession practices. The lawsuit, known as Ally Financial Inc. v. Haskins, centered around whether Ally properly notified borrowers before repossessing their vehicles.

The heart of the matter:

Borrowers claimed they weren’t given adequate notice of their right to cure their defaults before repossession.
This lack of proper notice, they argued, violated the Fair Debt Collection Practices Act (FDCPA) and state consumer protection laws.
Ally denied any wrongdoing and argued that they complied with all applicable laws.

Settlement reached:

In July 2021, the parties reached a settlement agreement worth over $787.5 million.
The settlement provided relief to borrowers in several ways, including:
Monetary compensation: Eligible borrowers received payments based on the amount of time their vehicles were improperly repossessed.
Debt reduction: Ally agreed to reduce or eliminate certain debts associated with the repossessions.
Credit report correction: Ally agreed to remove negative credit reporting related to the repossessions.
The settlement also included provisions designed to prevent similar errors from happening in the future.

Impact on borrowers:

If you had a car repossessed by Ally between June 4, 2009, and June 18, 2018, you may have been eligible for benefits from the settlement.
The deadline to file a claim was June 4, 2020.
While the settlement resolved the Haskins lawsuit, it doesn’t necessarily mean Ally is free from future legal challenges.
The case serves as a reminder for borrowers to carefully review their loan agreements and understand their rights in the event of a potential default.

FAQs:

Am I eligible for compensation from the Ally Financial lawsuit?

You may be eligible if you had a car repossessed by Ally between June 4, 2009, and June 18, 2018, and believe you weren’t properly notified.
Consult the settlement website for detailed eligibility criteria.
How much money can I expect to receive?

The amount of compensation varies depending on the specific circumstances of your case.
Visit the settlement website for information on calculating potential payments.
What if I missed the deadline to file a claim?

Unfortunately, you are not eligible for compensation if you didn’t file a claim by the deadline of June 4, 2020.
Can I still sue Ally Financial even though there was a settlement?
Yes, you may still be able to pursue individual legal action against Ally, but this would require separate legal representation.
How can I avoid repossession in the future?

Make sure you understand your loan agreement and the terms of repayment.
Communicate with your lender immediately if you encounter financial difficulties.
Where can I find more information about the Ally Financial lawsuit?

The settlement website provides comprehensive information about the lawsuit, eligibility criteria, and the claims process.

Conclusion:

The Ally Financial repossession lawsuit served as a significant reminder that borrowers have rights and lenders must adhere to specific legal obligations. While the settlement offered relief to many borrowers, it’s crucial for everyone to be informed about their rights and responsibilities when dealing with auto loans. By understanding the terms of their agreements and communicating openly with their lenders, borrowers can minimize the chances of facing a stressful repossession situation in the future.

References:

Ally Financial Inc. v. Haskins: https://topclassactions.com/lawsuit-settlements/closed-settlements/ally-financial-repossession-788m-class-action-settlement/
Fair Debt Collection Practices Act: https://www.consumerfinance.gov/compliance/compliance-resources/other-applicable-requirements/debt-collection/
Dianne Godbey v. Ally Financial, Inc.: https://www.law360.com/articles/1645837/banks-appeal-102m-entered-in-favor-of-insurers-receiver-insurance-guaranty-associations