Lost car used as collateral?

Question

Loss a car used a collateral?
Recently I had to take out a loan and to do so I used my car as collateral. My car was 8 years old but running ok. Well shortly after taking out the loan all sorts of problems requiring repairs happen and then to top it off recently someone ran into my parked car. I took it to the shop but just recently was told that the car is a "total loss". I was shocked because the damage didn't seem that bad but apparently it means the cost to repair exceeds the value of the car and they said my insurance company will likely try to settle with me.

so Question1 - what exactly does this mean that they will settle with me?

Question 2 - What are the ramifications of the fact that I am using this car as collateral.

I have no idea as all this was just hours ago told to me so any help or advice is appeciated.

Answer 1

I don't mean to minimize your dilemma, but this really made me laugh for your bank. Um, hmmm. It was OK when you signed the papers so it's not fraud.

You're going to get $ for the total.

If you don't have to be moved on for collections re the loan, you may be OK. I don't know if you have any obligation to replace the collateral. I'd get the papers out and read your terms closely.

Answer 2

If whoever gave you the loan with the car as collateral knew what they were doing, they would have immediately had their name put on the car's title as lienholder. This would prevent you from selling the car and then defaulting on the loan. It would also cause the insurance company to write the settlement check jointly to both you and the lienholder. You would either have to sign the check over to the lienholder, or provide them with another form of collateral before they will sign it over to you.

The meaning of settle with you is that the insurance company will try to reach an agreement over what the car was worth immediately before the accident.

Answer 3

properly, it wasn't precisely a kinfolk member. yet I did attempt to apply my ex-spouse as collateral. After being tossed out of the greater valuable showrooms, I worked my way concept GM, Ford or perhaps used motor vehicle plenty. the final deal i will make grew to become into for a Yugo. Used with 50,000 miles. The money have been low, $28.00 a month, whether it blew the engine 6 blocks from the dealership. I, of direction, refused to make anymore money. final I heard, they hauled her away and he or she is serving 12 years as a floor sweeper interior the Yugo plant. So, i think you will say all of it worked out for the final.