*Loan,banking and credit>>>auto loan

Can a credit union force car insurance on an auto loan after financing has already been established?

They tacked on an additional @$2700 onto my loan and since that time my car payment went from $350 a month to $700 a month. Before this happened, my credit was good, and since after that time my credit changed drastically. I've been told that this may be illegal. If anyone has info, please let me know. Oh, and this is in CALIFORNIA.

Thanks!

If you let the full coverage insurance drop on your vehicle? They do have the right to do this it's called "Forced place insurance" the auto loan companies have been doing this for years.

The only way to get it removed is to get your own insurance and then prove to your credit union that you have insured the vehicle. Source(s): Finance Manager for a car dealer for over 7-years.

Yes, they do it to protect their investment. If you get in a wreck without insurance you & the credit union are screwed. Get your own insurance and pay mo to mo.
They are within their legal rights I do believe if you read your docs with them you signed off on that stipulation.
your question doesn't make sense. No one has car insurance on an auto loan.

In CA, the law requires everyone to have car insurance. If you are financing your car, you are required to have car insurance by the lender, this is to protect the lender. From what you are trying to ask here, i believe you financed your car but your insurance lapsed, the lender bought the car insurance for you and billed you for the premium. If that's what you are asking, then the answer it's yes, they can forced car insurance on your financed car.

If you have already paid off your car, even though you are required by law to have car insurance, you don't have to get it if you don't want to like all the non-insured people trying to save a few bucks on insurance, then when they get into an accident, they cry foul.
Of course they have the right to do so. The automobile is their collateral. If you do not properly insure it on your own and protect their investment, they will do it for you. The same applies to homeowners who let home insurance lapse. The mortgage firm will slap on their OWN coverage until you get your own back. It's ungodly expensive, and generally wakes up most people.
The only thing I can do is reinforce what the others have said before me. If you look at your docs, you should have a doc that is titled "Agreement to Provide Insurance". This doc, that you inevitably signed, states that you agree to provide insurance on the vehicle or the credit union reserves the right to impose it on the vehicle and add the premium to your loan.
I am a bank manager and have sold a ton of car loans.