Do I Really Have to Pay Fairstone Financial and Not CitiFinancial?

Question:

Dear Steve,

I got a loan from CitiFinancial. they put a lien on my house for the $25,000 loan. I pay $500/month and have paid 15,000 so far. they say I still owe $19,000 BUT they were bought up by Firestone.

I was told that legally, I owe Citifinancial who is not in existence. I am not trying to get out of my loan, I want the lien removed. if my lien is with CitiFinancial, not Fairstone, shouldn’t it be removed?

Georgette

Answer:

Dear Georgette,

You’d have to go back to your original loan agreement and see what it has to say about transfers and assignment.

I believe you actually live in Canada.

I would bet CitiFinancial has such a clause in the agreement you signed. It’s fairly common. This would allow CitiFinancial to sell your loan and transfer it to a new company. But there is more to the story.

The issue gets a little murkier. According to a press release, Fairstone Financial is actually just a rebranded CitiFinancial in Canada. On top of that, Fairstone was then purchased by “J.C. Flowers & Co. LLC and Värde Partners, global investors.” – Source

So before you jump to the conclusion that Fairstone has no right to collect on your debt it appears they own, I would suggest you get more information directly from Fairstone regarding the status of your rebranded CitiFinancial loan.