Car loan BEFORE death

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My Mother is in a very bad way.  Two weeks before she fell ill she bought a new car. I'm her son AND her POA, health surrogate, and the executor of her will.  Question:  what to do with this car?  (130 miles on it, 2016)  I believe this needs to be "disposed" of before her passing to protect her estate.  The dealer wants nothing to do with it.  I've considered a private sale... just no time to be that involved.  I've contacted the creditor with the ridiculous idea that I assume the debt and transfer the title (I have no need for this car).  Take it to a place that buys autos?  I have considered every option. Please offer any helpful advice.  My only interest is to protect my Mother's estate. 

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What does the home have to do with it ?
The car is collateral against the car loan. To get rid of the liability/loan, pa... (more)

xoneinax (Jan. 02, 2017 @ 11:12a) |

But that's with the loan being current.  Stop paying, and hide the car in a garage where it cant get repo'ed, and I'll b... (more)

Glitch99 (Jan. 02, 2017 @ 2:03p) |

OP - what kind of vehicle?

ach1199 (Jan. 03, 2017 @ 9:52a) |

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The estate of the deceased is responsible for loan payments or a lump sum payoff, unless the deceased purchased credit life insurance. If the deceased had purchased credit life insurance on the loan, then the loan is paid off by the insurance carrier."I would double check the sales paper work. Sales people love to "bundle" loan insurance on unsuspecting buyers.


btw. what estate is there?

The loan is against your mother's credit and is secured by the vehicle itself, as a rule.

If you/she no longer need it, best bet is to likely just let it revert to the lender by not making any more payments, canceling any automatic payments, and calling the lender to arrange disposition of vehicle/keys/etc. (unless its worth more than the loan for some reason like a large down payment or something).

Depending on loan terms (and state, I believe), any negative balance after vehicle is auctioned might be billed to the estate. Whether you do it now or later is up to you.

If the estate will be on the hook, it might be financially beneficial to sell the vehicle yourself rather than take the relative pittance that it will go for at auction, lessening the gap between car value and debt owed.

Good read:
http://www.autoblog.com/2009/11/05/car-payment-die/

Depending on loan terms (and state, I believe), any negative balance after vehicle is auctioned might be billed to the estate. Whether you do it now or later is up to you.

Doesn't the creditor have to go-to court to get a judgement before they send you the bill.for the balance?

cutemco said:   I believe this needs to be "disposed" of before her passing to protect her estate.

I don't get this at all. So she dies with a new car with a loan on it. Big deal. Protect her estate from what? Paying the balance of the loan?

I can tell you this because of the death of a friend that caused all kinds of problems of being able to insure and drive a left behind car. Get a beneficiary title signed before your mother dies. It will allow you to get the car into the name of a living person that can insure it so you can legally drive it while you figure out what you want to do. Not sure all states have it, but it will make your life easier. In the friend's case, the car ended up getting towed while waiting for the 30 days to elapse that DMV required before allowing the title to be changed based on the small estate paperwork.

Chyvan said:   
cutemco said:   I believe this needs to be "disposed" of before her passing to protect her estate.

I don't get this at all. So she dies with a new car with a loan on it. Big deal. Protect her estate from what? Paying the balance of the loan?

I can tell you this because of the death of a friend that caused all kinds of problems of being able to insure and drive a left behind car. Get a beneficiary title signed before your mother dies. It will allow you to get the car into the name of a living person that can insure it so you can legally drive it while you figure out what you want to do. Not sure all states have it, but it will make your life easier. In the friend's case, the car ended up getting towed while waiting for the 30 days to elapse that DMV required before allowing the title to be changed based on the small estate paperwork.

  

OP WANTS the car gone

op, sorry for your mother's health. it appears to me the estate is some value....so Considering the entire situation the best deal would be to simply sell the car to carmax (remember it will not be the best price but it will be the wisest thing to do due to lack-of-time and it will be the smoothest txn to do) and just eat the difference today

If she gets rid of the car now, she will have to kick in the difference between the sale proceeds and the loan balance.  If you sell it after her death, the estate will have to kick in the difference between the sale proceeds and the loan balance.  

The only way selling it now "protects her estate" would be if something happens involving the car that results in the car's owner (your mom) being sued, and she is found liable with a judgement that exceeds her insurance limits.

needhelpplease said:   OP WANTS the car gone

And how does that protect the estate?

Glitch99 said:   If she gets rid of the car now, she will have to kick in the difference between the sale proceeds and the loan balance.  If you sell it after her death, the estate will have to kick in the difference between the sale proceeds and the loan balance.  

The only way selling it now "protects her estate" would be if something happens involving the car that results in the car's owner (your mom) being sued, and she is found liable with a judgement that exceeds her insurance limits.

  The care is a depreciating assets that require insurance, registration, payments, etc.

if it's not bing driven it's draining the assets of the estate.

stanolshefski said:   if it's not bing driven it's]draining the assets of the estate.
  
It would be doing that even if the car were being driven.

dealgain said:   op, sorry for your mother's health. it appears to me the estate is some value....so Considering the entire situation the best deal would be to simply sell the car to carmax (remember it will not be the best price but it will be the wisest thing to do due to lack-of-time and it will be the smoothest txn to do) and just eat the difference today
  +1

carmax is better than dealers (per a dealer I spoke to. he said something about them selling to high credit risk people=more margins...)

OP I would get a quote regardless so you have #s to compare to private sale etc..

stanolshefski said:   
Glitch99 said:   If she gets rid of the car now, she will have to kick in the difference between the sale proceeds and the loan balance.  If you sell it after her death, the estate will have to kick in the difference between the sale proceeds and the loan balance.  

The only way selling it now "protects her estate" would be if something happens involving the car that results in the car's owner (your mom) being sued, and she is found liable with a judgement that exceeds her insurance limits.

  The care is a depreciating assets that require insurance, registration, payments, etc.

if it's not bing driven it's draining the assets of the estate.

  Right, time is a long-term factor due to the depreciation of the car and the interest expense of the loan.  But his belief is that disposing it prior to her death somehow "protects" her estate, which is incorrect.

cutemco said:    The dealer wants nothing to do with it. 
 

  Why does the dealer want nothing to do with it?

Glitch99 said:   
cutemco said:    The dealer wants nothing to do with it. 
  Why does the dealer want nothing to do with it?

  Probably loaded with too many new cars and doesn't want to buy OP's car.

cutemco said:   My only interest is to protect my Mother's estate. 
Protect her estate from what?  

Sell the car, pay off the loan.  If the sales proceeds don't cover the loan, she (or her estate) will be on the hook for the difference.  End of story.  

hypothetically, one could dissemble vehicle and sell parts for cash. then one could hypothetically do something with auto insurance.

I thank everyone for the comments and advice. I've been reading as time permits. KBB seems to drastically reduce vehicle values. I was basing things on their stated sale value. It may be possible to sell privately and recoup at least the loan amount. A hassle yes. Carmax is also in the plans, for a baseline price. Surrendering the vehicle to the lender would cost $7k plus the down payment. Lenders do not have a "heart". There is a mortgage free home in the estate and personal possessions. Hence the importance of eliminating this liability. Thanks again.

cutemco said:   There is a mortgage free home in the estate and personal possessions.
  
Get a beneficiary deed in place on the house if your state allows it so it passes outside of the estate/probate at death. No one is going to want to liquid your mom's clothes to recoup the deficiency of the car.

my dad had crap cars his entire life and no money for most of it. he finally had some money,bought a mercedes (put abput half down in cash and got a loan for the rest) put about 800 miles on it until he had too much back pain to drive. it turned out he had lung cancer and tumors on his spine and he died about 8 months later in his mid 50s.
the car then sat for about another 4 months since nobody wanted to deal with it after watching him get tortured for so long.

eerily i bought a used car about a year later from a woman who said her mom had died. her mom died about months before she sold it and it basically had about 20 miles put on it during that time. she told me the same thing- it just sucks to deal with selling the car of a dead parent. and then she told me her mom had lung cancer.

anyway he was remarried but his wife would get fleeced way to easily.so me and my brother called around different Mercedes dealers and mostly got snake oil salesmen on the phone who either gave absurd 20k ish offers for a car worth 40-45k or tried to get us to come in.one guy i heard his voice change when i mentioned to him what happened.he wasn't acting and my guess is something similar happened to one of his parents or someone close to him. he told me if the car is in brand new condition with 800 miles on it like i said he'd pay 45k. it was about 53k new. that's who we ended up selling it to. the loan was paid off and my dads wife got the rest of the money as she should.

No dealership is going to take back a car they sold. $7k to surrender is pretty pricey, plus you're out your down payment.

Consider selling the car to beepi or carmax if you don't have the time, though carmax probably wouldn't give a good price on that new of a car.

cutemco said:   Lenders do not have a "heart". There is a mortgage free home in the estate and personal possessions. Hence the importance of eliminating this liability.What does the home have to do with it ?
The car is collateral against the car loan. To get rid of the liability/loan, pay off the loan. If you need to sell the car to do that, sell the car.

cutemco said:   Surrendering the vehicle to the lender would cost $7k plus the down payment.
 

  But that's with the loan being current.  Stop paying, and hide the car in a garage where it cant get repo'ed, and I'll bet they'll start negotiating - you just have to change the question from "collect the full amount" verses "accept less than what's owed", to "accept less than what's owed" verses "get nothing".

It might even be better to handle this after her passing, where you can simply send the lender the keys and a bank statement showing a minimal balance, and tell them they're welcome to that money if they insist.  Odds are pretty good you'll never hear from them again about the bank balance, let alone the full deficit.  I dont see you covering a $7k deficit selling it to anyone regardless, so waiting probably is your best bet to get rid of it "clean".

OP - what kind of vehicle?



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