answersLogoWhite

0

AnswerThe exact laws and procedures vary from state to state, but the lender's lien on the vehicle will remain in full force and effect. If the payments aren't made, the lender can repossess the vehicle. It also depends on what the will says about the vehicle. It might be given to a relative, who would have to make the payments to keep the car. It might be sold to pay off debts, but the lender would get paid first. These are just some, but not all of the possibilities.

In most cases, when a person has a loan on a car and the person dies, the note is "accelerated", meaning that it automatically becomes payable in full immediately even if there are months and even years remaining before it has to be paid. The promissory note will state this in its terms. The note will have to be paid by whichever beneficiary or beneficiaries receive the car by will or by intestate succession, or, if they do not want the car, it can be sold to someone else to pay off the loan.

User Avatar

Wiki User

10y ago

Still curious? Ask our experts.

Chat with our AI personalities

JordanJordan
Looking for a career mentor? I've seen my fair share of shake-ups.
Chat with Jordan
FranFran
I've made my fair share of mistakes, and if I can help you avoid a few, I'd sure like to try.
Chat with Fran
BeauBeau
You're doing better than you think!
Chat with Beau

Add your answer:

Earn +20 pts
Q: What happens to a car loan when the owner dies?
Write your answer...
Submit
Still have questions?
magnify glass
imp