Bought a car, had an accident, cant afford it anymore. What can i do?

Question

Bought a car in a small dealership, had an accident, cant afford it anymore because in the insurance my dad got me i was excluded. Im in San Diego,CA.The car is in bad condition due to the accident and im unemployed, and i just cant afford it anymore. Im paying for something i dont even have anymore. What should i do? Should i go bankrupt at age 19? Please help ='[

Answer 1

You financed a car, signed that you would have full coverage insurance on the car, with the dealer as loss payee, failed to get insurance coverage as required, then had a wreck  Obviously you weren't unemployed when you got the vehicle, or the financing wouldn't have gone through.

You didn't do what you should have done.  If you would have had full coverage insurance as you promised when you signed up, the car would be fixed and you'd be driving it.

Since it isn't the dealers fault you didn't follow the rules, you have little choice.  Get a job, and pay the car off.

Answer 2

You HAD to have full coverage on a vehicle you are paying on -I would be afraid of getting into trouble

Answer 3

You're in a tight spot.

If you stop making payments on the car - the finance company will repo it. They will sell it for what they can get. Since it's wrecked - they won't get much. Then they will pursue you for the balance of the loan. So, you will still end up owing on the car even though you don't have it.

You may want to give your bank a call. See if you can work something out with them.

A bankruptcy will trash your credit for 7-8 years. Once you get a job, you will be unable to get a loan for another vehicle with a repo and bankruptcy. Your better bet is to see if the bank will work with you.

And since Dad didn't list you on the car insurance so you were excluded --- maybe he should kick in and help you out.

Good Luck.  

Answer 4

Sorry, but you signed a contract. The fact that you wrecked the car is not the problem of the finance company. You will still have to pay for the car. That is what you promised to do when you signed the contract.  Also,  if the finance company finds out the car is wrecked they may "call"  your loan. That means the value of the collateral (car) is non longer worth what they loaned, and they may demand that you repay the total outstanding balance in full.

The problem you have is with your dad.   Why did he exclude you from the insurance if he knew you would be driving the car?

Going bankrupt may relieve you of this debt, but it will also follow you for the rest of your life . Most loan applications (personal, student, car,  mortgage, etc)  ask if you have EVER filed bankrupty.  Some day you may want to go to college, buy another car, possibly buy a house, and the bankruptsy will come back to bite you. That same question is sometimes  asked on job applications which could exclude you from a great job opportunity. That should be the last resort you turn to.