In a significant legal resolution, Bank of America has agreed to a $3.25 million class action settlement following allegations that it failed to properly notify Pennsylvania borrowers about the timeline for selling repossessed vehicles. The issue stems from a violation of Pennsylvania law, which mandates that lenders clearly inform borrowers of the date after which a repossessed vehicle may be sold—giving them at least 15 days to act. The lawsuit claimed that from December 23, 2016, to February 16, 2024, Bank of America neglected this obligation, potentially depriving borrowers of the chance to reclaim their vehicles or make alternative arrangements.
Though the bank denies any wrongdoing, the settlement aims to avoid prolonged litigation and provide monetary and credit relief to affected borrowers. The lawsuit, filed under the case name Nelson, et al. v. Bank of America NA (Case No. 5:23-cv-00255-JS), argues that the lack of proper notification led to unfair financial harm and credit damage. Many borrowers allegedly suffered repossession consequences without a full understanding of their legal rights, prompting widespread concerns and legal scrutiny.
To address these grievances, Bank of America has committed to financial compensation and the correction of credit reports for eligible individuals. The settlement covers Pennsylvania residents whose vehicles were repossessed within the specified period and who received incomplete post-repossession notices. Affected borrowers are not required to file a claim; they will receive benefits automatically unless they choose to opt out. These benefits include a portion of the settlement fund and improvements to their credit history—an important step toward rebuilding financial stability.
Why Was Bank of America Sued?
The class action lawsuit against Bank of America focused on its alleged failure to comply with Pennsylvania’s legal requirements surrounding vehicle repossession notices. Under state law, borrowers must be informed of a specific date, at least 15 days in the future, after which their repossessed vehicle may be sold. This timeframe allows borrowers a fair opportunity to reclaim their property or arrange alternative resolutions.
The lawsuit alleged that Bank of America’s notices omitted this critical date, effectively denying borrowers their legal right to act. As a result, many borrowers may have experienced vehicle loss and credit damage without a proper chance to intervene. While Bank of America has not admitted fault, it has agreed to settle to bring resolution to the claims and avoid further legal proceedings.
Who Is Eligible for the Settlement?
To qualify for the settlement benefits, individuals must meet the following criteria:
- Be a resident of Pennsylvania.
- Have had their vehicle repossessed by Bank of America between December 23, 2016, and February 16, 2024.
- Have received a post-repossession notice missing the required sale date information.
Those who meet these conditions will automatically be included in the class action. No claim form is necessary. Unless borrowers take steps to exclude themselves or object, they will receive their portion of the settlement benefits.
What Benefits Will Class Members Receive?
1. Monetary Compensation
Eligible borrowers will receive a share of the $3.25 million fund, distributed proportionally among all qualifying individuals. The final amount each person receives will depend on the total number of participants and associated administrative costs. To estimate their potential payment, borrowers can visit NelsonClassAction.com and use the “Estimated Award Eligibility” tool.
2. Credit Report Corrections
One of the most impactful benefits of this settlement is the agreement by Bank of America to help restore borrowers’ credit standing. The bank will request that major credit bureaus—Equifax, Experian, and TransUnion—remove any negative references linked to the repossession event. This action could lead to:
- Improved credit scores,
- Better chances of securing future loans or credit,
- Financial recovery from the adverse effects of repossession.
How to Check Payment and Credit Status
To determine if you qualify and to view estimated payouts, follow these steps:
- Visit NelsonClassAction.com.
- Select the “Check Eligibility” tab.
- Input your name, address, and loan information.
- Use the “Estimated Award Eligibility” section to preview your expected compensation.
Borrowers should also monitor their credit reports post-settlement through services like AnnualCreditReport.com to verify that any negative repossession data has been removed.
Important Deadlines to Remember
Borrowers should be aware of the following key dates:
- Deadline to Exclude or Object: December 18, 2024
- Final Court Hearing for Approval: February 18, 2025
- Expected Payment and Credit Relief Distribution: Following final approval (exact timeline TBD)
To be excluded from the settlement or to object, written requests must be submitted by December 18, 2024. Those who take no action will be automatically included in the settlement distribution and credit corrections.
Automatic Benefits for Borrowers
A key advantage of this settlement is that eligible borrowers are not required to submit any claims to receive compensation. Unless they explicitly choose to opt out or file an objection, class members will be included in the automatic payout and credit restoration process.
Action is only necessary for those who:
- Wish to pursue individual legal action by excluding themselves.
- Intend to challenge the terms of the settlement through objection.
Contacting the Claims Administrator
For additional questions or clarification, borrowers can reach out to the claims administrator using the following contact details:
Nelson v. Bank of America Class Settlement
c/o Settlement Administrator
PO BOX 23698
Jacksonville, FL 32241-3698
Email: info@NelsonClassAction.com
They can also find updates and resources at the official website: www.NelsonClassAction.com