The Car Loan Nightmare

This is a story about a nightmare I went through with my car loan. 

It all started a few months ago when I tried to pay off my credit cards through my online banking account. Imagine my surprise when the transaction was declined. A quick call to the bank informed me that I had a problem with my loan. 

I had actually sold off my last car in August last year. I went to my local Honda dealership and the Honda salesman put me in touch with a third party salesperson named Leslie. The initial agreement was for the third party salesman to pay the value of the remainder of my loan, which was about RM10000. I remember signing some documents for the sale of the car, and getting my thumbprint scanned through a portable scanner, and Leslie showed me on the JPJ website how my car grant had been transferred to his name. 

All fine and good until this whole issue cropped up almost a year later. I found out when my bank accounts were blocked. 

BLOCKED. 

Imagine my shock – I had always been diligent about servicing my loans and my credit cards, and initially I couldn’t think of what I might have done to have caused this. I was informed over the phone that I was behind my loan payments for my car. I was confused, and told them I made the payment myself every month, and there was no way I could be behind on these payments. After calling around, I found it this loan was for my previous car. 

Wait. 

But I sold off my car one year ago! 

Everyone who has dealt with bureaucracy would probably feel my pain, but this is apparently a very common scenario that happens (as the lady at Bank Negara very patiently informed me), and I was a victim due to my own ignorance of financial matters, which is why I have decided to put this out there. 

When you sell off your car, two things need to be done: Your car grant needs to be changed to the name of the new owner, and your loan has to be cleared. 

LESSON ONE

In the whole process of this transaction, I was told that the loan would be transferred. In my head, it meant that the new owner would take over the existing loan and continue to service it. 

Apparently there is no such thing. 

Whenever you sell a car, the existing loan needs to be paid off and you should get a discharge summary from the bank. A new loan is then made for the new owner. There is no such thing as a transfer of a loan, which I was told repeatedly by the car salesman 

LESSON TWO

The change of the car grant name has to be done through JPJ, either through the website or at the JPJ counters. In my case, the dealer had come over to my house and logged on through the JPJ website and proceeded to change the grant name, which he had shown me himself. He had a portable thumbprint scanner which seemed to make the process even more legit. 

Apparently, this is a viable way of changing the car grant; however – once the change of name request is submitted, JPJ will first check with the bank to confirm the loan status. If the loan has not been settled, the request to change grant names will be rejected. 

LESSON THREE

Make sure you check with your loan officer regarding the terms of your loan and if they have the capacity to actually freeze your assets with regards to a loan default. This should be written in your loan agreement but this is usually in legalese and the average person might not understand the legal or financial terms set. It took about three days to unfreeze my accounts and I was lucky that I had friends who were kind enough to help me out in my period (as I like to call it) of temporary bankruptcy. I was also lucky that the loan officer was reasonable enough to consider my request to temporarily block the amount that was currently owing (which was only about RM3000 at the time). 

I eventually sorted out my case with the managers at Honda, who were shocked that I had essentially been cheated and they managed to resolve the case internally. 

However, in the process of talking to friends, it was interesting to realize that so many people essentially had the same misconceptions as I did about loans, which prompted me to write this article. It is apparently a common scenario that happens to many people as well, and I was informed by officers at Bank Negara this has often led to the bankruptcy of some individuals, especially when it comes to more expensive cars. 

I was lucky that nothing much happened – although I probably have to check with CCRIS to make sure that the whole experience didn’t leave me blacklisted, but things eventually did get sorted out. Hopefully no one will get stuck in the whole messy experience that I did!

Financial Rules for Women in Relationships

Despite only being in the workforce for a few years, I have come across too many women who have undergone divorce and been left high and dry by their husbands. There are too many stories, too many real life incidences where husbands have cheated on their wives while abusing the joint assets that they have had during their marriage, often leaving women to fend for their children. 

It is a scary reality where women make the sacrifice to stay home and care for their children, only to have their husbands leave them in the future, or have them trapped in a situation where they are dependent financially on their husbands and forced to endure emotional or physical abuse. 

It makes me wonder if there is a certain naiveté among women, of if they just lack the financial savviness to protect themselves and their families. 

While being in a relationship, there is a natural tendency to want to please the other person, finances is one particular issue that can make or break a relationship – and it is really important that couples should discuss before embarking unto a serious relationship. 

In Islam, there is a responsibility of the husband to provide for his wife and family, which is all fair and good – but it is an expensive society that we live in, and often it is not possible to sustain an income on one wage. I’m not even getting started on leeches who live off the income of their spouses and don’t contribute, cause that’s a whole other rant I could get started on there. 

These are some practical tips that women should learn to live by: 

1. Be aware of your partner’s income. 

I’m not saying that you should keep track of every single dollar he owns, but there should be an honest discussion about the family income and what allocation is given to the home. An open discussion between both partners about family expenses is useful to help with planning a budget, so that both parties are aware as to the bills that need to be paid and the amount allocated for savings. 

2. Negotiate money for yourself. 

Working or not, this should be essential. Part of this money should be put in savings, insurance or invested. God forbid, but if anything should happen to your partner, you need to plan to make sure you are able to support your family unit on your own. 

3. Make sure you have a skill or a qualification that will allow you to work. 

 Once again, case in point if anything should happen to your partner, it is important to be able to provide for yourself and the family. Even venturing into a side business for some extra income should be encouraged. 

4. Include two names on your property grants 

 It is always a good idea to include both you and your partner’s name for your shared property (unless it is your own, then by all means only include your name). Always get a second opinion from a trusted source about changing names to a single grant, as this makes it easier for the other party to sell off or conduct other transactions without your knowledge. 

There are a whole other heap of useful tips to go by, but in the very least, these are some simple things to live by.

While I don’t mean to sow discord or go on a man-bash, finances is one of the most important things to be aware of in your relationship and being financially savvy puts you in a stronger situation for yourself, and in a lot of times, your relationship. These rules aren't necessarily specific to women, but as I was thinking specifically about the sad situation that many women are in, I guess this was geared towards them.

Be smart, and always think – if I were alone tomorrow, where would I be financially?