Totalled Car with a Title Loan (insurance, property taxes, costs)

[Sher4u]

So, I was rear ended on Friday afternoon. I took the car to Joseph Toyota to get an estimate on repair to send to the guys insurance. The estimate came out to be 2700. My car is only worth that much on Blue Book. I sent the estimate over to the insurance and am currently awaiting on a response. The damage is really only the tail light that I am worriied about. The dings and scratches I don't care about. I am fine with them just cutting me a check for 1200-1500 and calling it a day, but I feel like they will total my car. the thing is, 3 weeks ago I was in a bind and took out a title loan for 1000 on my car. What will happen? Will I need to inform the insurance of the title loan lien or will I be able to go through this and keep the two separate? Im not sure what to do right now.

Thanks

[WILWRadio]

Do you have any kind of loan other than the title loan on the car?

Yes, you should inform the Title Loan company about what has happened. That car was collateral for that loan. You are still on the hook for the loan and will likely have to cut a deal with them to make payments in the event you don't get your car back.

The guy that is at fault will send out someone from his insurance company to offer what they perceive is a fair value to have the car repaired. Then it is up to you and your insurance company to decide whether or not to accept that offer and then determine where to repair it.

If you only have a tail light that is busted and some dings and scratches and NO frame damage then it will likely not be totaled. If you have a bent frame then it may be considered a total loss.

[Señor Slick]

I don't know why you would need to notify the title loan company of the problem until you have it resolved with the insurance company. If they reimburse you for having the damage fixed that doesn't change the fact that you still owe the title company on the loan. If they "total" the car and cut you a check you should then use the insurance money to pay back the loan and fix the car to the extent that you care about it. I would only notify the title loan company if the car was a total wreck and undriveable which basically leaves them without collateral. At that point they would probably demand payment in full or work out some extremely one-sided (in their favor) payment plan.

Sorry about your car. Hope it all works out for you.

[5ForksSC]

If the car is a total loss, and the title loan co is listed as a "loss payee" on your policy, then more than likely the ins co will issue a 2 party check. Made payable to you and the loan company.

[kjbrill]

If another person was determined to be responsible for the accident, just sit tight. You may be surprised how the law turns out if you were not the person at fault.

[WILWRadio]

Originally Posted by kjbrill

If another person was determined to be responsible for the accident, just sit tight. You may be surprised how the law turns out if you were not the person at fault.

I had two cars totaled in 2012 and boy was I surprised how each incident turned out. Despite neither accident being my fault, I ended up about 6 to 7 grand in debt thanks to the way the system works. Had to come up with money for new down payments on the next car, gap insurance did not cover the remaining balance on one loan and I had to make up the difference because the insurance company would only pay what they deemed to be the actual value of the car. And my insurance rates went up too! Factor in the cost and time to shop for a new car, higher property taxes on a newer vehicle and you can easily end up being surprised.

To the OP. Be prepared to have to come up with money out of your own pocket to cover some of the costs I mentioned.

[Sarah Perry]

I was a claims adjuster for a while. If the company that's paying you (yours or the other company) asks you if there are any liens on the car, it would be advisable to tell them the truth. If the car is repairable, they'll probably include the name of the repair shop or the lienholder on the check. If it's totalled, you'll be signing the title over to the insurance company or to their designee, and they're not going to "buy" the car from you without a clear title or the assurance the title WILL be clear once the check is cashed.

There's no down side to you in being up front with the insurance company about this. Unless you somehow didn't comply with the loan company's requirements to carry insurance.

[joe from dayton]

Originally Posted by Señor Slick

I don't know why you would need to notify the title loan company of the problem until you have it resolved with the insurance company. If they reimburse you for having the damage fixed that doesn't change the fact that you still owe the title company on the loan. If they "total" the car and cut you a check you should then use the insurance money to pay back the loan and fix the car to the extent that you care about it. I would only notify the title loan company if the car was a total wreck and undriveable which basically leaves them without collateral. At that point they would probably demand payment in full or work out some extremely one-sided (in their favor) payment plan.

Sorry about your car. Hope it all works out for you.

The insurance company will not give him a check for the car AND let him keep the car. If they total out the car, they will become the new owners of it.

[Sarah Perry]

Originally Posted by joe from dayton

The insurance company will not give him a check for the car AND let him keep the car. If they total out the car, they will become the new owners of it.

Well, not to be argumentative, but if the car is a total loss and the owner agrees to pay the insurance company as much as they could get for the salvage (wrecked car), they'll probably let him keep it if he wants. When I say pay, I mean agree to have the value of the salvage deducted from his payment.