In recent news, Bank of America has agreed to a $3.25 million settlement following a class action lawsuit. The lawsuit alleged that the bank failed to provide proper notice to borrowers after repossessing and reselling their financed vehicles. If you’ve ever had a car repossessed by Bank of America, you could be eligible for a payout. This article will guide you through the key details of this settlement, how to determine if you qualify, and what benefits you might receive.
Bank of America to Pay $3.25M in Repossession Settlement
| Topic | Details |
|---|---|
| Settlement Amount | $3.25 million |
| Eligibility Criteria | Vehicle financed through Bank of America, repossession between December 23, 2016, and February 16, 2024, and residing in Pennsylvania |
| Settlement Benefits | Cash payout based on claims, credit report relief |
| Key Dates | Opt-out or object deadline: December 18, 2024; Final approval hearing: February 18, 2025 |
If you were affected by a vehicle repossession through Bank of America between December 23, 2016, and February 16, 2024, the $3.25 million settlement could provide both financial relief and an opportunity to improve your credit score. Be sure to check the eligibility requirements and follow the settlement process carefully.
What Is the Bank of America Repossession Settlement?
The class action lawsuit, titled Nelson et al. v. Bank of America NA, was filed in response to allegations that the bank did not properly notify borrowers after repossessing their vehicles. Under the law, when a lender repossesses a financed vehicle, they are required to notify the borrower before selling the car or taking further action. If you were impacted by this, you may have legal rights to compensation.
The class action lawsuit alleges that Bank of America violated these notification requirements between December 23, 2016, and February 16, 2024. As a result, the bank agreed to a $3.25 million settlement, which will be distributed to eligible borrowers.
Who Is Eligible for the Settlement?
You may be eligible for the settlement if:
- You financed a vehicle through Bank of America – The loan must have been handled by Bank of America.
- Your vehicle was repossessed between December 23, 2016, and February 16, 2024 – This is the key period of the lawsuit.
- You received a notice after the repossession – Bank of America must have sent you some form of communication after repossession.
- You were a resident of Pennsylvania during the repossession – While the settlement is not nationwide, residents of Pennsylvania may qualify.
What Happens if You’re Eligible?
If you’re eligible for the settlement, you’ll receive two primary benefits:
- A cash payout: The total $3.25 million settlement amount will be divided among eligible individuals. The exact payout amount will depend on the number of valid claims submitted.
- Credit report relief: Bank of America will also request that credit reporting agencies delete any mention of your auto loan account. This could help improve your credit score, especially if the repossession negatively impacted your credit history.
No action is required to receive these benefits unless you choose to opt out or object to the settlement. If you don’t take any action, you’ll automatically receive the benefits once the court approves the settlement.
How Much Could You Receive?
The exact payout amount for each eligible borrower will vary. It depends on several factors, such as the number of valid claims submitted and the overall distribution of the settlement funds. While it’s hard to estimate exactly how much you’ll get, you can expect a proportional share based on how many people file claims.
Example:
If 1,000 eligible borrowers are approved, and each receives a 1% share, you might receive $325 (assuming the fund is split equally, minus legal fees and other costs).
How to File a Claim
You don’t need to file a claim to receive the benefits of the Bank of America repossession settlement unless you opt-out. The settlement is automatic, and those who qualify will be contacted once the court gives final approval.
Step-by-Step Guide to Filing a Claim
- Check your eligibility: Review the criteria mentioned above to determine if you qualify for the settlement.
- No action required: If you’re eligible, no further steps are needed unless you want to exclude yourself from the settlement.
- Claim deadline: If you want to file a claim or object, the deadline to do so is December 18, 2024.
- Approval: The final approval hearing will take place on February 18, 2025.
Benefits of Participating in the Settlement
For those who qualify, the Bank of America repossession settlement offers real benefits, including financial compensation and the potential for improved credit scores. While some people may hesitate to join a class action lawsuit, this case highlights the importance of being aware of your rights when dealing with repossession.
Cash Payout
This settlement provides a direct financial payout, which could be helpful for those affected by the repossession. Although the payout may not be a significant amount, it can still provide some financial relief or compensation for the inconvenience or hardship caused by the repossession.
Credit Score Improvement
The request to delete any references to the auto loan on your credit report can also be a significant advantage. Repossessions can have a long-lasting impact on your credit score, which affects your ability to secure loans, mortgages, and even rental agreements. If your loan is removed from your credit history, it could improve your overall financial standing.
Understanding Repossession and Your Rights
Repossession occurs when a lender takes back an asset (usually a vehicle) after a borrower fails to make required payments. According to consumer protection laws, lenders must follow specific procedures to protect borrowers’ rights during the repossession process. These include:
- Notice of Default: Lenders must notify the borrower that they are behind on payments before repossession occurs.
- Notice After Repossession: Lenders must notify the borrower after repossession about the intention to sell the vehicle and the borrower’s right to redeem it.
In cases like this, where borrowers claim that these rights were violated, class action lawsuits can offer a way for consumers to receive compensation without having to file individual lawsuits.
FAQs On Bank of America to Pay $3.25M in Repossession Settlement
1. How do I know if my vehicle was repossessed by Bank of America?
If your vehicle was financed through Bank of America and was repossessed, you would have likely received notices or letters from the bank during or after the repossession process. You can check your loan documents or contact Bank of America directly to confirm.
2. Can I still join the settlement if I live outside Pennsylvania?
Unfortunately, this settlement is only available to borrowers who were residents of Pennsylvania when their vehicle was repossessed. If you lived elsewhere, you may not be eligible.
3. What happens if I opt out of the settlement?
If you opt out, you won’t receive any benefits from the settlement. However, you also maintain the right to file your own lawsuit against Bank of America for similar issues. If you choose to opt out, make sure to do so before the deadline on December 18, 2024.
4. What if I never received a notice after my vehicle was repossessed?
The lawsuit claims that Bank of America may have failed to properly notify borrowers about their repossessions. If you didn’t receive a notice and your vehicle was repossessed during the covered period, you may still be eligible for the settlement. Be sure to check your loan details and verify if you’re eligible.
5. What if my vehicle was repossessed in another state but financed by Bank of America?
This particular class action lawsuit only covers borrowers who were residents of Pennsylvania at the time of repossession. However, Bank of America has faced similar legal actions in other states for repossession-related issues. You can check if there are other active settlements by visiting trusted legal websites such as TopClassActions.com.
