Co signer left holding the bag after car wreck !! Need advice please!! - Page 3 - Mercedes-Benz Forum

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post #21 of 62 (permalink) Old 03-25-2009, 01:45 PM
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Originally Posted by cascade View Post

So this really sweet friend of mine has got caught up in a hurricane of really bad circumstances after co signing an auto loan for a new 2008 Hyundai, for her daughter, landing in a perfect storm of things gone badly wrong, afterwards.

She is a responsible home owning teacher with a 20 y o daughter that's made a huge mess.

The daughter already wrecked her mom's car and then her boyfriend (at the time, this last October) and her prevailed on her mother's good nature, to co sign for a new loan, with the express (but unwritten!) understanding that it was only a temporary situation for mom, who only did it to help her get started again.

But after two payments were made on the car, the boyfriend secretly DROPPED the collision insurance on the car and did not tell the mother who co signed, and then not too long after that, the daughter drove too fast on a mountain road, near the lake, went off the side, and rolled the car several times, and totalled it.
She wrecks 2 cars and mom bailed her out? Then, BOYFRIEND drops insurance? Sounds like a sob story to me. LEGALLY, boyfriend can't do SHIT to drop insurance unless it's HIS car. So, how did boyfriend REALLY accomplish this?

Originally Posted by cascade
The insurance company correctly denied coverage as the premiums had not been paid, the worthless wreckage was towed away and left in a salvage lot, the two kids that bought the car have "no money" and the finance company is threatening to go after mom who co signed the loan, wanting it to be paid off, as the auto loan has gone bad, it is months delinquent, but the collateral is totally vanished, gone to some wrecking storage lot in Bakersfield, where it sat so long, the tow company has some storage lien on the junk that was recently a 2008 Hyundai.

Incredibly, the daughter is now back, begging for $1,000 for a THIRD vehicle, a used truck, and mom doesn't have the money;
Proves to me mom is a pushover.

Originally Posted by cascade
She is facing an angry creditor that she thinks could force her into bankruptcy, loss of her home and financial ruin!!

The Hyundai cost $18,000, loan delinquent since December, the uninsured auto, its collateral, was totalled and is gone, the insurance did not pay off, the loan was for 6 years and interest about 10%. Paid out in full over 6 years, I saw the contract for the loan, which amounted to about $31,000 total, including all interest on this brand new $18,000 car.

Mom has a lovely '06 Mazda3, which she own is free and clear, and probably worth $10k.

She consulted an attorney who said as a co signer, yet innocent of bad behavior, she is nonetheless on the hook for the money owed.

I told her this; I agree she is probably almost certainly liable for this, but perhaps she could get rid of the Mazda3, to erase the debt to maybe $10,000 or so and set up a repayment schedule that she could handle on a teacher's salary, and be rid of it all in 3-4 years or so, avoiding credit ruin, and judgment collection efforts.....

I further told her that in my opinion, to give this reckless daughter ANOTHER bite at the apple, cash for a 3rd car, is just WRONG, as it enables more irresponsible behavior....she should get rides until she saves money to buy her own car, all by herself, and that she should make her daughter sign a notarized paper, promising repayment to Mom for the car which she had orally promised to do, "when she got a job later" at the moment she bought the car.

The boyfriend, of course, has since broken up with the daughter, and has totally vanished, and is on the lam, though if it were me I would try and find him and sue him if it would do any good.

The mother would need to buy herself another new car, if she sold her vbeloved Mazda to help erase this debt, and she loves the ideal of an old, genly used Mercedes, if she had to, (that I could help her locate, here in sunny So Cal,) but she told me emphatcally that she loves and adores her only liquid asset - the 2006 Mazda3, as it is the first brand new car she ever had, and doesn't want to sell it just for a thing like this!!

Ideas and your opinions are needed!!

What should she do?

It is giving her nightmares, what are your opinions here?


Your signature fits right into this story. Sorry I have no advice to offer but, as you well know, the famous Forrest Gump said, "Stupid is as stupid does".

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post #22 of 62 (permalink) Old 03-25-2009, 01:50 PM
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Originally Posted by gregs210 View Post
Actually, for the mom that is NOT going to help her. Our crap legislators rolled over for the credit lobby and amended the BK code several years ago, so it's now pretty draconian (I know whereof I speak, this is what I used to do for a living). Depending on her state she may have to give up her car (too much equity) and have limited protection for her house and other assets and/or become an indentured slave to a five-year Chapter 13 plan that will dictate her budget (but on the positive side, the court mandated budget won't allow her to throw away more money on her silly daughter...)
A real good lawyer will walk her through the process. She will have to take financial courses which will allow the court appointed trustee to see if she is even in fact able to repay the debt. In the end, I think she will most likely loose the car, not do to the value but her overall assets exceed that of the debt. If she has anything such as 401k's, savings, jewelry, tv's you name it, that eventually exceed the value of the debt, the trustee can and may seize these properties sell them, then determine what she needs to pay. It sucks but the new law prevents fraudulent filings while also helping those get back on her feet. In one case she can also take the advice of the people where she has to take the financial courses and opt not to file, still be protected with a pre determined settlement amount and monthly payment. The downside is if they move forward with the suit she will surely have to pay their lawyer fees and associated interest, plus the car hasn't been returned to the lender which makes for a harder time reducing the principle amount.

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post #23 of 62 (permalink) Old 03-25-2009, 02:35 PM
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Mom should sue her daughter and the estranged boyfriend. Make the daughter at least pay some. Paying for a car she doesn't have anymore will suck real bad and will teach her a lesson. Secondly, kick the looser daughter out. No more loans, no nothing. If boyfriend dropped the insurance, which he can't , isn't it illegal? Can't she go after the boyfriend and make him liable? Otherwise the mother will have to pay. I blame the mother the most. I'm sure she knew her daughter was a looser and irresponsible, yet she cosigned? WTF? Maybe mommy needs to grow up. The loan SHOULD be paid, not defaulted because the whole country pays then.
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post #24 of 62 (permalink) Old 03-25-2009, 02:41 PM
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But if she ends up buying a beaten up Benz, will she still be able to buy cheap parts from Germanstar?

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post #25 of 62 (permalink) Old 03-25-2009, 03:43 PM
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Only sound advise for prospective co-signors: DON´T!!!!!!!!!
Mom is now in for the duration. Daughter and boyfriend better learn to jog (if I were Mom).

Sue the boyfriend if you can prove that HE dropped the collision insurance. If he is not of age, his parents or guardian. Get your daughter a part time, to pay you back your loss. It´ll be harsh, but they will appreciate the experience.

Last edited by JoeVal; 03-25-2009 at 03:49 PM.
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post #26 of 62 (permalink) Old 03-25-2009, 04:03 PM
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Originally Posted by gregs210 View Post
Um, that is irrelevant.

The focus here is the mom, who in Psychological terms is an "enabler" and co-signed. Whether the other obligors file bankruptcy is IRRELEVANT, they will go after whoever is also liable and has assets they can pursue, which is mom.

Cascade, she really only has a couple of alternatives. I think she would be smarter to grab a second on her house (since the interest will be deductible and lower than other alternatives) and then pay off the creditor. Otherwise penalties and interest will continue to accrue and she will ultimately be sued, and guess what? Then she will also have to pay their attorneys' fees and court costs.

As far as helping the daughter further, that's a personal issue; personally I'd tell her to grow up, find a job and buy your own car.

Mom was really lucky this bimbo didn't hit someone else, otherwise she'd be losing her house to a medical bill/damage judgment. Expensive lesson, but at least she isn't homeless.

If she really loves her daughter, she'll close the door on this revolving credit line so the girl can mature a bit.
I asked because if it was a minor child you could possibly go after their parents for the money. You can go after the kid, obviously, but he doesn't have any. The parents might.
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post #27 of 62 (permalink) Old 03-26-2009, 03:50 AM
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Mother is too soft and an idiot to continue to believe this daughter, if truth be told I would think the daughter is either lying about the bf dropping the insurance coverage or knew about it and signed off for it. Does someone have to sign for this kind of covrage being dropped so why has Mom not followed this up directly with the insurance company? Probably afraid of what she will find, Mom and daughter both need to grow up.
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post #28 of 62 (permalink) Old 03-26-2009, 04:56 AM
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were they both blonde?
Only kinda explanation I can figger fitting this sob storey
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post #29 of 62 (permalink) Old 03-26-2009, 05:59 AM
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Originally Posted by cascade View Post
Ideas and your opinions are needed!!

What should she do?

It is giving her nightmares, what are your opinions here?


If I were the mom, I'd buy that daughter a nice low cut, high skirt line, red dress, and send her ass out onto the street to make some $$ to pay off HER debt. But that's just me and I'm a softie.

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post #30 of 62 (permalink) Old 03-26-2009, 06:51 AM
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Originally Posted by Jetjok View Post
If I were the mom, I'd buy that daughter a nice low cut, high skirt line, red dress, and send her ass out onto the street to make some $$ to pay off HER debt. But that's just me and I'm a softie.

Hmm... does that mean you wouldn't be a client without a shot of viagra?

In CT that would not have been possible for some of the reasons cited by others. You cannot have your policy canceled without proof of continuing insurance. And, when there is a loan for the vehicle, the demand for proof of insurance is made to the title holder. The bank would have been notified immediately. If they did nothing they might share in some of the culpability, but in CT this whole scenario would be impossible. The boyfriend and the daughter and the mother lack the authority to unilaterally change the insurance coverage on a vehicle they don't own. The story sounds fishy to me. And that is not because the red dress is too short and she isn't wearing panties. It was fishy before that image was drawn.

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