Do I have to pay my lender the money from insurance company after a total loss?
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Do I have to pay my lender the money from insurance company after a total loss?
My insurance company direct deposited me the
money from a total loss do I have to pay that to
my finance company and what are the legal
consequences if I dont?
Asked on January 25, 2019 under Accident Law, South Carolina
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 5 years ago | Contributor
If you don't pay them they will sue you and win, getting an enforceable court judgment against you which will damage your credit and which they can use to garnish your wages or put a lien on any real estate you own, or to take money from your bank account. When you finance a car, you owe them the full amount on the agreement regardless of what happens to the car. If you don't pay them, you have violated the contract--the loan agreement is a contract--between you, so they can sue for breach of contract. Since there generally is no defense to your obligation to pay, they will win.
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