Deceased Husbands Debts - Car Finance shortfall

[Racy Tracy]

Please please help!!!.....on the 12th April my husband was tragically killed in a motorcycle accident, and because he didnt leave a will I have now been left with sorting out all the paperwork for Probate etc.......i have got a brilliant network of family and friends that are helping me with this, but somethings have left me very confused.
We have a car that is on a pcp agreement. The car was purchased last Feb, and the agreement is only in my husbands name and the monthly payments were taken via Direct Debit from his account, (which is now frozen). I have had a settlement figure from the finance and the car is in slight negative equity, and I have been told that whatever the difference is between what the car is worth and what is owed on it, will have to be paid. But then other people have told me that I wont have to pay anything because the car and the agreement was only in my husbands name, therefore I can not be held liable to pay for it.......as the debt was my husbands and not mine, and now my husband is no longer here i have been told that the debt dies with him.
Please could somebody tell me if this is correct or not. I dont work and my husbands was the main breadwinner. Can the finance company make me liable for any monies outstanding on this agreement or any others that my husband had. He had a finance agreement on his motorbike but I have been told that the insurance will sort that out so i shouldnt worry about it.
The settlement figure on the car is £11,349.00 and its currently worth around £10,000.....so again can I be held liable to pay the difference between these two figures when there is nothing on the agreement at all in my name.....everything was in my husbands name.

Please help
Thankyou xx

[wales01man]

Re: Deceased Husbands Debts

Bump
think this lady needs someones help
Anyone?

[Amethyst]

Re: Deceased Husbands Debts

Hi Tracy

They can't make you liable for the shortfall on the car but I believe they can claim on your late husbands estate. I'll move your post so people who know how these car finance deals operate to have a look in for you, as its not really my area, and there might be different rules.

Hope you're holding up okay xxx

Sharon
x

[wales01man]

Re: Deceased Husbands Debts - Car Finance shortfall

Thank you Ame she deserves help with this

[Amethyst]

Re: Deceased Husbands Debts - Car Finance shortfall

Do you know if there was any insurances to deal with shortfall included in the hire purchase or a separate product ?


There's a fair bit about what happens upon death of the hirer in the Hire Purchase Act 1964 ( 15 /16 / 17 ) which all appear to state the claim should be on the hirer's estate.

15. 7. )Where the person who, immediately before his death, was the hirer under a hire-purchase agreement has died, and his rights under the agreement have not yet passed to a personal representative.—

(a)section 9 of the Administration of Estates Act 1925 (vesting of estate of intestate between death and grant of administration) shall not be construed as enabling a notice of default to be served on the Probate Judge (as defined by that Act) as being the hirer under that agreement, and

(b)subsections (1) to (5) of this section shall have effect as if the deceased person had not died, and any reference in those subsections to default in the payment of a sum payable by the hirer shall be construed accordingly.

[Guest]

Re: Deceased Husbands Debts - Car Finance shortfall

Yes any oustanding sums due would com e out of your husbands estate (if any) you would ot be liable unless you were mentioned on the contract.

Something that is probably not appropriate because you have not had the car very long but worth mentioning , if your husband had paid half of the total credit price of the car(this includes any deposit) you can voluntarily terminate the vehicle under section 99 of the consumer credit act, this means that there would be nothing further to pay(providing there are no arrears).

when creditors give a settlement figure they always give the voluntary surrender figure, which as you say depends on the resale value of the car and is sometimes significantly more than the VT value

[enquirer]

Re: Deceased Husbands Debts - Car Finance shortfall

As Amethyst points out, as long as you had no financial involvement yourself, then the matter is between the creditor and the estate. You are not personally liable.

Whatever you do, you do as executor of the estate - a distinctly different person altogether.

[Guest]

Re: Deceased Husbands Debts - Car Finance shortfall

If you post the financial details of the agreement and the total amounts paid upto date, I will check the settlement figures for both VT and VS situation for you, provided there is an approximate figure for the value of the car.

Deposit /part exchange
Total amount payable under the agreement
monthly payments
APR

[Guest]

Re: Deceased Husbands Debts - Car Finance shortfall

Do you know if there was any insurances to deal with shortfall included in the hire purchase or a separate product ?


There's a fair bit about what happens upon death of the hirer in the Hire Purchase Act 1964 ( 15 /16 / 17 ) which all appear to state the claim should be on the hirer's estate.

15. 7. )Where the person who, immediately before his death, was the hirer under a hire-purchase agreement has died, and his rights under the agreement have not yet passed to a personal representative.—

(a)section 9 of the Administration of Estates Act 1925 (vesting of estate of intestate between death and grant of administration) shall not be construed as enabling a notice of default to be served on the Probate Judge (as defined by that Act) as being the hirer under that agreement, and

(b)subsections (1) to (5) of this section shall have effect as if the deceased person had not died, and any reference in those subsections to default in the payment of a sum payable by the hirer shall be construed accordingly.

HP act repealed by the CCA 1974 Amethyst Similar provisions there though.

Modifications etc. (not altering text)
C1Whole Act except Part III and s. 37, repealed (subject to a saving in relation to certain agreements before 19.5. 1985 in S.I. 1983/1551 art. 6) byConsumer Credit Act 1974 (c. 39, SIF 60), s. 192, Sch. 5 Pt. I

[Amethyst]

Re: Deceased Husbands Debts - Car Finance shortfall

See told you it wasn't my area

[Racy Tracy]

Re: Deceased Husbands Debts - Car Finance shortfall

thank you every one for your advice......the car agreement was on one of these PCP deals, im not sure whether it was 3 or 4 years. I have already been told what the settlement figure is £11,309.55....this figure is valid until the 27/06/2014. The finance is with Santander and so far they have been 'ok' with me. They have given me 3 options, 1. I can pay the settlement figure and keep the car (which is not an option), 2. ask a third party to continue with the monthly payments (again not an option), or 3. voluntarily hand the car back........so far its looking like this is my only option as I dont work and have no form of income to continue with the monthly payments. I can confirm that the agreement is ONLY in my late husbands name......as he was the only one that worked and he was the only one who could get credit on it. I understand that any money outstanding comes from my husbands estate and therefore its not physically 'me' thats paying it, but I have been told by so many people that I am not responsible for the debt, therefore I cant be made liable to pay it......the way I feel at the moment I just dont care, if it needs to be paid then il pay it.....but i dont know when im going to have the funds available to pay it, as I said before I dont work and because of this tragic accident I am now a widow and a single parent trying to bring up my 12 yr old son who is missing his dad like crazy.....so this is just another hassle on a long line of hassles that i dont need right now.....:tinysmile_cry_t:

[Racy Tracy]

Re: Deceased Husbands Debts - Car Finance shortfall

just to add on to that, my husbands eldest brother said what ever i do, DO NOT LET THE FINANCE COMPANY COLLECT THE CAR, he said if i did that all they would do is just come and pick it up on a car transporter, (which there would probably be a fee for), take the car away, send it through an auction and just get a minimum price for it, and then come to me for the difference.......so he suggested going back to the ford dealership where we bought it from and just explain to them what has happened, and see what they will offer me for it......he said this way, if they do decided to buy it back from me, they will then send a cheque off to the finance company and il just pay what evers left out of my late husbands estate.......

[Guest]

Re: Deceased Husbands Debts - Car Finance shortfall

thank you every one for your advice......the car agreement was on one of these PCP deals, im not sure whether it was 3 or 4 years. I have already been told what the settlement figure is £11,309.55....this figure is valid until the 27/06/2014. The finance is with Santander and so far they have been 'ok' with me. They have given me 3 options, 1. I can pay the settlement figure and keep the car (which is not an option), 2. ask a third party to continue with the monthly payments (again not an option), or 3. voluntarily hand the car back........so far its looking like this is my only option as I dont work and have no form of income to continue with the monthly payments. I can confirm that the agreement is ONLY in my late husbands name......as he was the only one that worked and he was the only one who could get credit on it. I understand that any money outstanding comes from my husbands estate and therefore its not physically 'me' thats paying it, but I have been told by so many people that I am not responsible for the debt, therefore I cant be made liable to pay it......the way I feel at the moment I just dont care, if it needs to be paid then il pay it.....but i dont know when im going to have the funds available to pay it, as I said before I dont work and because of this tragic accident I am now a widow and a single parent trying to bring up my 12 yr old son who is missing his dad like crazy.....so this is just another hassle on a long line of hassles that i dont need right now.....:tinysmile_cry_t:

OK the settlement figure they quote will be the voluntary surrender figure. What you need to ascertain is the Voluntary termination figure, they will not give you this until you ask.

This would be due after the car goes back. It may be that you owe considerably less than you think, it mat not, it depends on the details of you contract and the amount paid so far.

If you have already paid half the sums due under the agreement your husbands estate will owe nothing at all.

[Guest]

Re: Deceased Husbands Debts - Car Finance shortfall

Also you are right do not let them collect and do not sign any authority to VS until you know the score regarding a VT.

[Racy Tracy]

Re: Deceased Husbands Debts - Car Finance shortfall

thanks for the help......to andy 58, im not sure what you mean by 'Voluntary Termination Figure'.......the finance company has already told me that if my husband has paid more than half of the settlement figure then they can just collect the car and thats the end of it, but if he has paid less than the settlement figure then whatever the shortfall is, will have to be made up.......but im not sure if they mean the shortfall between what my husbands paid and half of the settlement or.....the shortfall between what my husband has paid and the actually settlement figure. I went to Ford today and they were helpful but they did say that they couldnt really do much for me other than buy the car back and they offered me a figure of £8,500......but they also said that they wouldnt be able to do anything at the moment anyway because the car isn't in my name, and until ive got probate etc, there's nothing much that they could do for me........this is so confusing and hard work......