An Ontario man said when he went to get into his car after work, he was surprised to see it wasn’t there and thought it had been stolen.
“I was scared, anxious and stressed. I saw an empty space where my car was supposed to be and I didn’t know what to do,” said Jeff Pierre of Markham, Ontario.
Pierre has a 2018 Hyundai Elantra and last year the car needed new brakes, tires and other repairs. The auto shop he went to said he could pay for the repairs with loans totaling $4,909, and he agreed.
Pierre said he didn’t want to borrow the money because he felt he had no other option with a baby on the way.
“I didn’t have the funds to be able to repair the car and I needed it to take my wife to work and I also need the car to go to work,” Pierre said.
Pierre obtained the loans with Wippy, a company that works with auto shops and offers loans to consumers for auto repairs, tires and rims.
When Pierre missed two payments, Wippy repossessed his car and told him that if he wanted it back he had to pay $9,708, which was the loan amount plus interest and other fees.
“At least give me a chance to pay the outstanding balance, because no one wants their car repossessed,” Pierre said.
A Wippy spokesperson told CTV News Toronto: “Recovery is always a last resort for us and we understand the emotional and financial impact it can have on individuals and families. “We exhaust all possible avenues to avoid these types of situations, including multiple attempts to contact customers and arrange alternative payment arrangements.”
“However, when all efforts fail, we are obliged to take appropriate measures to recover outstanding debts. “While we empathize with the challenges Mr. Pierre faces, it is important to recognize that these costs arise as a result of the situation and are part of the overall debt recovery process.”
The Wippy spokesperson also told CTV News: “It is important to note that our company offers several options to suit different financial needs… Some of our plans offer a 0% interest rate if payments are made on time . However, in case of default, a predetermined rate may be applied… We do not assign an interest rate based on the customer’s credit rating, the customer can choose any of our plans ranging from 0% to 25.95%” .
Meanwhile, credit counseling services told CTV News they are receiving more calls from people who are having their cars repossessed because of the financial situation they are in.
“Certainly during this time of inflation and people struggling to make ends meet, we are hearing more about these experiences from callers and their stories are often heartbreaking,” said Becky Western-Macfadyen, financial advisory manager at Credit Canada.
Western-Macfadyen said if your car is repossessed, it will have a dramatic impact on your credit rating and score, which will take years to improve.
“A garnishment will remain on your record for seven years, and that is whether voluntary or involuntary. “If your vehicle is repossessed, it will also be more difficult for you to qualify for a car loan in the future,” he said.
Pierre also has an outstanding bank loan on the car, but says there’s no way he can pay the $9,708 owed for the repairs, meaning they’ll likely sell the car to pay the bill.
“I just can’t pay that lump sum in one payment. It’s just not possible for me,” Pierre said.
If you are having financial problems and are missing a loan payment, it is best to call the lender ahead of time to see if they will work with you as this may help you avoid having your car repossessed.