by Guest » Tue May 13, 2008 06:05 pm
Hello,
I understand that if I file a claim for the damage a storm did to my vehicle, and there is a loss, the insurance company (as long as I have comp coverage) will issue a claims check. And if the vehicle's title is held by a bank, the check will likely include ME AND TEH LIENHOLDER, or ME AND THE BODYSHOP.
Well...what if they issued the check in my name ONLY?
Here are my questions:
1. If I decide to cash the check and use it entirely to pay down my loan balance, could this come back to bite me?
2. If I used this check for a family emergency, or really anything BESIDES the damage of the vehicle, could this come back to bite me somehow?
3. Are there any risks in using the claims check NOT for what it was issued for?
I understand that if I file a claim for the damage a storm did to my vehicle, and there is a loss, the insurance company (as long as I have comp coverage) will issue a claims check. And if the vehicle's title is held by a bank, the check will likely include ME AND TEH LIENHOLDER, or ME AND THE BODYSHOP.
Well...what if they issued the check in my name ONLY?
Here are my questions:
1. If I decide to cash the check and use it entirely to pay down my loan balance, could this come back to bite me?
2. If I used this check for a family emergency, or really anything BESIDES the damage of the vehicle, could this come back to bite me somehow?
3. Are there any risks in using the claims check NOT for what it was issued for?
Posted: Wed Jul 02, 2014 04:11 am Post Subject: marj
Recently, my car sustained hail damage. I made a claim to my i.surance company and an adjuster came to my home to assess thedamages. He estimated the damage to be nearly $4000 minus my $500 deductible, which i dont have. Since i dont have my deductible is it fair to offer the check that was made out to me and my leinholder to use the check and apply it to the balance i owe on my vehicle? What if they refuse and tell me i have to make the repairs even if i dont have the deductible? I could possibly find a body shop that will do it for close to the amount of the check that was made out to me and my leinholder. But you cant squeeze blood out of a turnip so if they require me fix it and the repairs are less than the amount of the check, is the remainder mine?
Posted: Wed Jul 02, 2014 02:05 pm Post Subject:
What if they refuse and tell me i have to make the repairs even if i dont have the deductible?
You have multiple questions. But this is one that you may already know the answer to -- or at least you can look to see.Your loan contract with the lender probably requires you to maintain the vehicle in proper working order, and, essentially in good cosmetic condition. $4000 in damage is extensive, and would indicate that there is probably broken glass in addition to all the other damage. This is common in auto loans, because the vehicle is the security for the loan. Failure to repair a damaged vehicle could be breach of contract and can be grounds to accelerate the loan and demand the remaining loan balance.
What the lender cannot do without your consent is us the money meant to be payment for repairs to make a payment on the loan. That's called "conversion" and would be a breach of contract on the lender's part.
I could possibly find a body shop that will do it for close to the amount of the check that was made out to me and my leinholder.
Yes, this is your privilege, and you are encouraged to do so. Any money left over is yours.Add your comment