Can banks deny that you've paid your loan?
As expressed in the title, can a bank deny it that you've paid back the loan? Or how can you make sure that won't happen?
My sister recently got married, but she freaked out when her husband told her that he had previously taken out a loan for ,500. She was concerned that, although the current balance was only 0, at some point in the future, someone will turn up at their house and ask them to pay the money again with interest.
I'd like to know what steps should be taken to calm her and convince her, that nothing can happen. (I've told her that the transaction report can prove that the loan was paid back, but it/I wasn't convincing enough).
I'd like to know some facts that can prove my point that she has nothing to worry about.
(3)3 Comments
Sorted by latest first Latest Oldest Best
Yes, if their record keeping is faulty or failed.
It is best to keep all records of repayment. Incomplete records such as signing for a loan yet no repayment receipt can be at least a headache and at most expensive.
The most important document is a record of 0 balance then there is nothing that the courts will allow creditors to collect if their records are faulty.
If the loan is for a car, or mortgage there is specific paperwork that is processed when the loan payments have been completed.
For other types of loans ask the lender, what will they give you regarding the payoff of the loan. Keep this paperwork, in hard copy and electronic form forever.
Maybe there's more to this story, because as written, your sister seems, well, a little irrational.
Is it possible that the bank will try to cheat you and demand that you pay a loan again that you've already paid off? Or maybe not deliberately cheat you, but make a mistake and lose track of the fact that you paid? Sure, it's POSSIBLE. But if you're going to agonize about that, what about all the other possible ways that someone could cheat you? What if you go to a store, hand over your cash for the purchase, and then the clerk insists that you never gave him any cash? What if you buy a car and it turns out to be stolen? What if you buy insurance and when you have a claim the insurance company refuses to pay? What if someone you've never met or even heard of before suddenly claims that you are the father of her baby and demands child support? Etc etc.
Realistically, banks are fanatical about record-keeping. Their business is pretty much all about record-keeping. Mistakes like this are very rare. And a big business like a bank is unlikely to blatantly cheat you. They can and do make millions of dollars legally. Why should they break the law and risk paying huge fines and going to prison for a few hundred dollars? They may give you a lousy deal, like charge you outrageous overdraft fees and pay piddling interest on your deposit, but they're not going to lie about how much you owe. They just don't.
I suggest that you not live your life in fear of all the might-be's. Take reasonable steps to protect yourself and get on with it. Read contracts before you sign, even if the other person gets impatient while you sit there reading. ESPECIALLY if the other person insists that you sign without reading. When you pay off a loan, you should get a piece of paper from the bank saying the loan has been paid. Stuff this piece of paper in a filing cabinet and keep it for years and years. Get a copy of your credit report periodically and make sure that there are no errors on it, like incorrect loan balances. I check mine once every year or two. Some people advise checking it every couple of months. It all depends how nervous you are and how much time you want to spend on it. Then get on with your life.
Has your sister had some bad experience with loans in the past? Or has she never borrowed money and she's just confused about how it works? That's why I wonder if there's more to the story, if there's some basis for her fears.
Terms of Use Privacy policy Contact About Cancellation policy © freshhoot.com2025 All Rights reserved.