QUESTION
Is an auto loan the spouse's debt? How?
Asked on Aug 27th, 2015 on Estate Planning - Oregon
More details to this question:
My Dad has an outstanding auto loan. He and Mom recently relocated and he died 2 weeks ago. He asked me to drive the car. There is the outstanding loan, but he was the only one on the loan. No $ in the estate. May we contact the loan co, ask them to pick up the vehicle and cancel the loan due to his death?
7 ANSWERS
If the vehicle is worth the same or less than the outstanding amount on the loan, the loan company will repossess the vehicle. If the vehicle is worth significantly more than the loan and there are other debts owed by the estate, you will need to sell the vehicle, pay off the loan, and use the remaining funds to pay other debts.
Answered on Aug 31st, 2015 at 5:23 AM
Business Attorney serving Orem, UT
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Kirton & McConkie A Professional Corporation
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The loan is certainly secured by the vehicle, but may be a valid debt of your father's estate as well. If the estate has no cash but does have some other illiquid assets (like real estate or business interests), these would potentially be subject to the claims of the lender. An attorney experienced in probate and estate planning in Utah can help you shorten the time for creditors' claims and help you respond to claims when made. K
Answered on Aug 28th, 2015 at 2:22 PM
Litigation Attorney serving St. Louis, MO
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Probate Law Center Richard J. Keyes, PC
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In Missouri the auto loan should not be a debt your mother's debt. If you cannot afford to pay off the loan and there is no equity in the car, then you can call the finance company to repossess the vehicle.
Answered on Aug 28th, 2015 at 10:59 AM
Commercial Attorney serving Chicago, IL
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Ashcraft & Ashcraft, Ltd.
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The loan follows the asset. If there are no assets in the estate then the lender should claim the car as collateral for the loan.
Answered on Aug 28th, 2015 at 8:42 AM
Yes, although the loan won't actually be cancelled it's just that the lender won't be able to recover anything from the estate.
Answered on Aug 28th, 2015 at 8:34 AM
Commercial & Bankruptcy Law Attorney serving Powell, OH
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Ronald K. Nims
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Since your father was the only one liable on the loan and he's died without any assets, the lender can repossess and sell the car but they can't go after anyone for the balance of the loan.
Answered on Aug 27th, 2015 at 10:40 PM
Probate Attorney serving Newport, OR
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Minor, Bandonis & Haggerty P.C.
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Yes, cooperate with the loan company to give the vehicle back best to contact them first. If there is nothing else in the estate, then it should be fine.
Answered on Aug 27th, 2015 at 4:33 PM