What To Do When You Still Owe Money On A Totaled Car
Getting into a car accident is always inconvenient. Sometimes, though, it can cause real financial concerns. If you are in a car accident, and the insurance company totals your car, will the settlement be enough to pay the balance of your car note off? Let our car accident attorneys explain some different scenarios.
What is Gap Insurance?
Our car accident attorneys recommend that you learn about this before an accident occurs. Gap Insurance will cover this difference between what you get paid for your totaled car, and what you owe on it. If your down payment on the car was less than 20% of the sale price, then you should consider gap insurance. It needs to be purchased before an accident, so if you don’t have gap insurance, and the accident was your fault, you will have to pay the balance due on the car. You will be responsible for the remainder of the payments. Call your loan company and work out a payment plan if you don’t have the full amount to pay the car off.
What if the Accident Wasn’t my Fault?
If the accident wasn’t your fault, that changes things. If you still owe money after the other insurance company has given you a figure on what they’ll pay for the total loss, ask for the difference. If you’re not sure how to navigate this scenario, hire a personal injury lawyer to work with you. This is the best way to get the full amount you owe on your car.
Who Is Responsible for Paying the Car Off?
Ultimately, you are. You agreed to borrow a certain amount of money at a certain percentage rate and to make all payments until the car is paid off. Without the collateral of the car (when your car is a total loss) the lender will expect loan repayment in full. There is a considerable danger in “rolling over” your note to buy a new car and include the balance due on a previous car. If you get into an accident, you can end up owing a lot of money on a totaled car.
Do I Need a Lawyer?
You certainly should hire one if you are in a situation like the one we described above. A personal injury lawyer will make sure that you get compensation for all aspects of your accident. In addition to property damage, you may have sustained injuries, missed wages, and run up doctor bills. When it comes to the property damage portion of your claim, your attorney will make sure that the condition of your car is taken into consideration. All features must be figured into the total amount you are offered (air conditioning, power accessories, etc.).
The Bottom Line
If your car is totaled, and you don’t have gap insurance, and you still owe money on it, you will have to pay for it. A lot depends on if you are found at fault. Working with a car accident lawyer from the beginning may help with every aspect of your outcome. Get an ally that has your best interests at heart–contact the car accident lawyers at our law firm today!