I'm sure someone here has an answer to this question :-)

[Brooke Wilde]

Someone financed a car for me. It is 100% in their name. I make the payments & keep it insured.

If this person dies before the loan is paid off, will the finance company know this person passed away & demand the car be surrendered or can I just keep making payments like nothing has changed?

Thank you in advance for your help

[pxmcc]

i'll take a stab at this one. the answer to your question will actually be found in the fine print of the loan documents signed by the party who took out the auto loan. that will lay out the legal rights the financing company has in case the person taking out the loan dies before the loan is paid off. you can find that if that person has his loan documents still, in the legalese fine print.

also, look for words in the loan docs along the lines of "transferability" of the loan itself to 3rd parties. best case scenario is the loan is freely transferable to 3rd parties, on the same terms.

as a practical matter, unless the car has a ton of equity, the finance co. would probably prefer to keep receiving car note payments from the "equitable owner;" i.e., you, than having to go through the hassle of repoing the car just because legally they have a right to.

but if it's a '68 shelby with a loan balance of 2k and they have a legal right of repo 'cause the legal owner died, then things might get interesting..

my rec would be to talk to the parties about this what-if, specifically, to the legal owner and the finance company. most likely, the finance company won't care as long as the loan is kept current and in good standing.

others may have a different take, but that's my 2 cents worth.

[majorjones]

I think unless the owner has a will giving you the vehicle upon death you are fucked out of your vehicle and money invested. And if they don't die they can take possession of the vehicle at any time and again you are fucked.

[NordicJag]

I pretty much agree with px and the major. If this is a word of mouth agreement then you you could be screwed. I suggest that you consult an attorney and get some papers drawn up for this transaction.

[winn dixie]

Keep good receipts

[Brooke Wilde]

Thank you for the replies!

I do have the contract from the dealership, so I'll have to look it over.

I am not worried about this person taking possession of the car or doing anything foul.

I have a "right of possession" form so if the car ever gets towed, I can retrieve it from the impound yard & I don't ever plan on selling the car so having the title is not that important to me.

I'm just wondering if they pass away, will the finance company know, or can I keep making payments like nothing has changed?

[GhostRiderYYZ]

What you may want to look into is at the very least is get your name added to the title of the vehicle.

I had to xfer my late father's truck to me, there is a form for "right of survivorship" or something like that where you have to produce a death certificate, and register the vehicle in your name. But if you get your name ADDED to the vehicle's title that might help.

[Michael8219]

^ this.

Mortgage companies, and I suspect most lenders, subscribe to a death certificate database. When there’s a match, they hop into action to protect their financial interest.

So an heir or executor might report the auto stolen. Your friend may be loaning you the car and you continue to make payments but with every thing automated and cameras all over that read license plates it might make for a short time period to use the vehicle after his/her death.

But if you get your name on the title then you’re the sole owner after presenting the death certificate to the county with a title transfer form.

[Bowser98]

And now that you’ve posted this thread on the internet, you better hope like hell this person doesn’t die a suspicious death.

[Brooke Wilde]

I took some time over the weekend to look over the contract & not once, anywhere is death mentioned. There is a small area that mentions "optional life & credit disability insurance", however, that was not taken out.

I also googled "what happens when someone dies & there is a balance due on a car loan", but the answers are all over the place. Some links say the car will need to be refinanced in another person's name & other links say just keep making on time payments & everything will be fine.

One thing I saw when I was googling was something called "credit life insurance". It seems like that may be my best bet. I'm going to call a few places today & see how much that costs. The balance due is still over 50k so I am a little worried it may be pricy :-(

As for what happens to the car once he passes, as long as the finance company does not demand possession, I am sure I'll be able to safely keep it. This man is like a dad to me, I actually call him dad. We are not in a sexual relationship (& never have been). He has absolutely no surviving family & never had kids. I have power of attorney over him, the little he has, he has left to me & I am on his bank account & pay the few bills he has for him.

Hopefully he lives to be a 100 years old & this matter will not be an issue.

[MarcellusWalluz]

Originally Posted by Brooke Wilde

I have power of attorney over him, the little he has, he has left to me & I am on his bank account & pay the few bills he has for him.

Hopefully he lives to be a 100 years old & this matter will not be an issue.

This is all you need, the bank won't try to take the car. Unless some long lost kin come out of the woodwork you don't have to worry about anything.

[Michael8219]

I would use the power of attorney to add your name to the title

[DeathBySnuSnu]

May want to check and see if there are any documents that state the vehicle will be considered "paid off" if the person on the paperwork passes away. I had a spouse pass away and the vehicle that was in her name was considered paid off once a death cert was issued. I don't remember what the document was called or if it's still even offered.

To make a long story longer, we didn't know she was gonna pass away when we got the vehicle. It was offered to us and didn't cost any extra.

For context this was around 2010, and she was in her 30's

[Brooke Wilde]

I called about the "credit life insurance" but the monthly payment is astronomical so that is not feasible

Originally Posted by MarcellusWalluz

This is all you need, the bank won't try to take the car.

I hope you are right. I have a feeling everything will be okay.

Originally Posted by Michael8219

I would use the power of attorney to add your name to the title

Do you know if I am allowed to do that while there is still a lien on the title?

Originally Posted by DeathBySnuSnu

May want to check and see if there are any documents that state the vehicle will be considered "paid off" if the person on the paperwork passes away.

I think that's what optional "life & credit disability insurance" is & unfortunately that was not taken out when this car was financed.

[MarcellusWalluz]

Originally Posted by Brooke Wilde

Do you know if I am allowed to do that while there is still a lien on the title?

It's possible but a lot of paperwork for the finance company so they won't want to do it unless they are going to benefit from it financially. You two can go into the DMV & add yourself on the registration if you're not already on it. I wouldn't worry about it, just be sure you receive or have access to all the correspondence from them so there are no issues when they release the lien & title.