I'm screwed

Discussion in 'Credit Talk' started by kenny, May 8, 2001.

  1. kenny

    kenny Well-Known Member

    I have a car loan through Household, in new york yo have to have full coverage insurance. I only have ilability. I just got in a accident today going to work. A police report was taken and it was no fault. Her car was barely scracthed mine has over 5,000 in damage. Ilability doesn't cover damage to my car only the other persons. The car is barely driveable. I don't have 5,000 to get it fixed, what should I do?

    I am so despressed. I am tempted to just let household take to car back and save up enough cah over the next year to put a big down payment on another car. I don't know what to do. Maybe if I pay the extra money for full coverage tomorrow it will kick in and cover the accident even though it happened today. I don't know what to do.
  2. jonesing

    jonesing Well-Known Member

    I'm almost positive that no insurance company will let you pay the premiums now and cover your vehicle for a previous accident. Depending on the age of the vehicle, some insurance companies might even require an inspection to account for such things (they do that a lot in Texas what with killer hail and all).

    I had a similar thing happen to me but mine was an act of nature. My then finance co didn't require full coverage once you reach a certain equity level (kind of like dropping PMI after you hit 20% equity in your home). Anyway, what I wound up doing was looking in the paper and some of those free new/used auto rags and found some dealerships with offers like: "We'll pay off your loan gauranteed!" "Minimum $2000 on any trade whether you push, pull or tow it in!" "Special financing, everyone approved!" etc.

    So I checked out one brand-name dealership's web site, found a vehicle I liked and talked to the online rep. I asked her if they were serious about the push, pull or tow deal and she said yes. I pretty much consumated the deal over the phone (had to go through special financing at the time) and had a tow truck drop me and my car off at the dealer's auto body department. Note that the used car sales people never saw my car or it's condition until after I left with my new vehicle. Of course they made out very well on the deal--I got $3000 for my car but they made up for it elsewhere.

    You might try looking for similar places.
  3. Concerned

    Concerned Well-Known Member

    I think he is on to something here. They will essentially roll the balance onto your new car payment. What that means is this: you car (with damage) is valued at say $2000, you owe $5000 on it to Household. You pick out a new $10,000 car. You will end up with a $13,000 loan. They will subtract the value of the car and from the amount still owed and put that number on top of the loan they will get you for your new car.

    This is how SOME of those "We'll get you out from under your loan today!" deals work.

    Good luck.
  4. MikeB

    MikeB Banned

    Kenny, you might double check to make sure that Household didn't have insurance added on your account. I don't see how they would have loaned you the money for the car unless you had full coverage. Most banks will verify that you have full coverage and add insurance to your loan if your coverage is dropped by your other insurance carrier.

    Exactly how can a two car collision be a "no fault" accident? Just curious. If you could prove it was the other person's fault....problem solved.

    If you were to let the car get repossessed, Household would charge off the account, and then they would charge you for the loss or cost of repair. The higher the amount, the more likely they will litigate, not to mention wrecking your credit record for years to come.

    Last resort is to try and trade it in on another car as posted above. You will take a big loss, but you will be preserving your credit record. Good Luck
  5. MikeB

    MikeB Banned

    Oops, also, DON'T get full coverage after the accident and claim it was before. They WILL catch it, and you WILL probably go to jail for insurance fraud.
    The date on the police report will get you!
  6. Linda

    Linda Well-Known Member

    Are you saying it's going to cost $5,000 to repair the car to make it drivable? If you can afford mechanical repairs then consider doing that. As long as your finance company continues to receive payments until it's paid off they should be happy... I would think.
  7. roni

    roni Well-Known Member

    MIKE B

    NY State has no fault accident policy. It sucks but that is just the way it goes in NY. I guess with all the accidents.....

    Also Household is not good at checking insurance. I moved and cancelled my original insurance policy in NY for a Pa one. The insurance co., allstate, told household that I was no longer covered. Household sent me a letter asking for proof of new insurance. I had State Farms for the new co. Well, I never sent in the paperwork to Household. They never asked again. I refinanced with another bank thru State Farms though last month. Bottom line, Household never checked to see if I had new insurance more less what kind.
  8. kenny

    kenny Well-Known Member

    Re: MIKE B

    I know if I trade the ar in like this, I will take a "major bath" on it. I got it so it's driveable. Should I a) Dirve it all dented up for the next 5 years b) Trade it in and take a major hit c) Save up enough doe (5000.00 to fix all the body damage)
  9. roni

    roni Well-Known Member

    Re: MIKE B

    did you get a ticket? will this show up against your license and raise your premium alerting household? just a thought.
  10. kenny

    kenny Well-Known Member

    Re: MIKE B

    Bo ticket just a accident report
  11. jonesing

    jonesing Well-Known Member

    Not all finance co's verify ful coverage on a continuing basis. Maybe once or twice a year. That's how come a LOT of people in Texas get by without insurance. There are insurance storefronts that write 3-month, 1-month, and 2-week long policies...yes 2 weeks. Now they say they are providing a service for those who are "in between" insurance carriers but c'mon...how much legit business could there possibly be for people who need 2-week policies? It's just long enough for you to get your car inspected, get your registration sticker from the local supermarket and, if need be, verify toyour insurance co if they ever contact you.

    Now as for the finance company's insurance. It is, in most cases, not liability or comprehensive coverage for your vehicle. It's a policy that covers their financial interest in the car. So if you dropped your insurance completely and are found to be at fault for causing an accident with injuries to others and property damage, then you're screwed because your car loan will be paid for but you still have to pay out of pocket for the damages you caused.
  12. Mike2

    Mike2 Well-Known Member

    Re: MIKE B

    I'd drive it (as long as it was safe) and start fixing the damage with what you can afford over the coming months. You may find it's cheaper than $5000 to get it back in shape. It seems like the pricing on body work comes down once the body shop realizes there isn't some blind insurance check coming to cover it all. Get it back into reasonable shape and trade. At least that's what I would do. Giving it back to Household isn't worth the trouble down the road. Also, get full coverage.
  13. Nave

    Nave Well-Known Member

    No Fault does NOT mean No One was at fault. In certain states the insurance companies pay their own policy holder's accidents. If the insurance companies think they can sue the other party they do it, but you don't have to worry about under insured drivers and it clears the courts a bit.

    No fault mandates limits on claims by and compensation to auto accident victims, in effect regulating public access to the courts. While the insurance industry reform approach focuses on cutting the price of the policy, the industry's no-fault approach focuses on reducing certain policy benefits for victims while at the same time expanding coverage to include those who cause auto accidents.

  14. jean1221

    jean1221 Well-Known Member

    You will have to eat some cost no matter what I say listen to the poster that said to trade it in. If you ruin your credit and dont pay you will be sorry for it later. You knew you were required to have the insurance and took that risk. So bite the bullet. There is no getting around the money part. But I wish you good luck.

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