What happens to a car with an outstanding loan upon death?
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What happens to a car with an outstanding loan upon death?
My father-in-law has a car that no one wants upon his death. What has to be done with it?
Asked on December 3, 2011 under Estate Planning, Colorado
Answers:
FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
If your father-in-law passed away with a loan still unpaid upon his vehicle and one wants the vehicle, the executor of his estate assuming he was a Will or the trustee under the trust have the decision to either continue making the payments on the loan by the estate or not.
If payments are not made, then the lender will repossess the car and sell it at auction where most likely there will be a deficiency owed by the father-in-law who is deceased. The lender then has the option to file a claim against the estate for the deficiency and if not accepted by the estate, the lender could file a lawsuit for the money owed on the loan.
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