My father-in-law recently died in a horrible car accident and has two new cars that he purchased within the last year. The family, especially my mother-in-law (who is unempoyed), is worried that the debt will fall on them.
NOTE: No one else was on the car loan or the title, nor was there a co-signer.
Does anyone know if what happens, in the state of Oregon, when the borrower on a car loan dies? I was hoping we could just return the car to the bank and call it even, since no one else is on the loan or title. I think it's ludicrous for the bank to go after the family!
If you're familiar with this issue, please feel free to contact me with any helpful advice. Thanks!
2006-12-08 09:08:49 · 9 answers · asked by chasenkatonfamily 1 in Cars & Transportation ➔ Buying & Selling
When someone gets a loan to buy a car the bank puts a lien against it. This prevents anyone from selling the car and not paying the bank back. it is their collateral.
If there is money owing on the cars, and he did not have insurance on the loan that pays off the loan in the event of death etc. The bank has the right to seize (repossess) the cars. The cars are sold and the money is applied to the loan. Also if the bank loan is still not paid in full after the cars are sold they can sue his estate for the remainder. SORRY.
PS they will take the cars. But I'm pretty sure they will still come looking for money.
2006-12-08 12:59:25 · answer #1 · answered by ? 6 · 0⤊ 0⤋
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2016-09-26 21:37:56 · answer #2 · answered by ? 3 · 0⤊ 0⤋
First - very sorry to hear about your father in law. The sudden passing of a relative can always be very tramatic and leave many issues to resolve.
In regard to the autos, generally speaking a brand new vehicle depreciates dramatically as soon as it is driven off the lot (which is why dealers try to sell you gap insurance to cover the difference between the cost of the new car and the current value in case of an accident). Unfortunately, the bank probably won't want them (they'd have to sell them too and they don't want the hassle). The bank financed them for your father in law for the purchase from a dealership - nothing more. They have a security interest in the car and would only take it back in the event of a loan default most likely (which I don't recommend).
You'd have better luck talking to the dealer he bought them from who may be willing to work with you to get them sold given the circumstances (I am not sure how long ago he bought the vehicles). I would guess that your best bet, however, is going to be to try to sell them outright to someone else to pay off as much of the car loans as possible. (Hopefully your father in law put a substantial amount of money down on them and the loans are less than the value of the cars). If you haven't already, it might also help to speak directly with the company that financed the vehicles and have them explain what they do in those instances so you understand your options.
As a CPA, I also agree with what was said by the other people. Your father in law will most likely have some estate issues that need to be resolved (even if he doesn't have enough of an estate to warrant filing an estate tax return or paying tax.) and these loans with probably be considered debts of the decendent. Hopefully he had a will and life insurance. You would be well advised to attempt to discover whether he had an attorney and/or CPA that he worked with in the past (see if you can find where he kept his important papers. If he was married, your mother in law may know). If not, you should give careful thought to contacting an estate/trust/probate attorney and/or CPA in Oregon to wrap up your father in law's affairs and that your mother in law understands the process. Depending on his wealth, he could have many issues with tax implications.
Make sure you ask in advance how the attorney/CPA charges and what kind of fees you can expect. I know many CPA's are very good about meeting for an hour on a complimentary basis to discuss your concerns. I wish you the best of luck in this difficult time for your family.
2006-12-08 09:47:30 · answer #3 · answered by bigbadnumber3 1 · 1⤊ 0⤋
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RE :Help with Car Loan & Death of Borrower - Oregon?
My father-in-law recently died in a horrible car accident and has two new cars that he purchased within the last year. The family, especially my mother-in-law (who is unempoyed), is worried that the debt will fall on them.
NOTE: No one else was on the car loan or the title, nor was there a co-signer.
Does anyone know if what happens, in the state of Oregon, when the borrower on a car loan dies? I was hoping we could just return the car to the bank and call it even, since no one else is on the loan or title. I think it's ludicrous for the bank to go after the family!
If you're familiar with this issue, please feel free to contact me with any helpful advice. Thanks!
Follow 8 answers
2016-12-02 20:46:55 · answer #4 · answered by ? 6 · 0⤊ 0⤋
You should be worried. As a cosigner, if he is defaulting, you have EVERY RIGHT to REPOSSESS the car from him, sell it ( or keep it and make the payments ) and pay off the loan. NO, you cannot go to court and have yourself taken off the loan. He would have to refinance the loan into his name only (which it sounds like he won't be able to do) in order to relieve you of the onus of owing money on this car. I would take the car from him. Then, he will be a big baby and probably try to sue you...LOL He won't win though when you present his payment history and how it affected your credit. And, it is true, if he gets in an accident and maims or kills someone, the injured party has every right to sue YOU, because, A: you co own the car and B: have deeper pockets than your son Get that car back ASAP.
2016-05-23 07:30:47 · answer #5 · answered by Anonymous · 0⤊ 0⤋
Have you tried talking with the loan department at the bank to see if they will take the cars back? Consulting a lawyer would also be good to do. The executor of your father in law's estate may be able to sell the cars to pay off the debts also.
2006-12-08 09:14:14 · answer #6 · answered by Trackerrrr 4 · 0⤊ 0⤋
Most lenders require insurance for the car. If the car was totaled the insurance company pays the bank.
There may even be life insurance on the loan.
2006-12-08 09:22:54 · answer #7 · answered by R1volta 6 · 0⤊ 0⤋
When a person dies, the debt reverts back to the person's estate.I am sure that you will need a lawyer or executer of the estate to tidy up this person's affairs. If you do'nt have someone, do it soon because otherwise it will become a big mess!
there are a lot of other things such as taxes that become due immediately after a person dies and you need a proffesional to help you with that!
2006-12-08 09:21:27 · answer #8 · answered by 1dutchie 1 · 0⤊ 0⤋
check with the note holder and see if they had an insurance policy on the loans
2006-12-08 14:29:32 · answer #9 · answered by doug b 6 · 0⤊ 0⤋